Document and Entity Information
Document and Entity Information | 9 Months Ended |
Sep. 30, 2022 shares | |
Cover | |
Document Type | 10-Q |
Document Quarterly Report | true |
Document Transition Report | false |
Document Period End Date | Sep. 30, 2022 |
Entity File Number | 1-9576 |
Entity Registrant Name | O-I GLASS, INC. |
Entity Incorporation, State or Country Code | DE |
Entity Tax Identification Number | 22-2781933 |
Entity Address, Address Line One | One Michael Owens Way |
Entity Address, City or Town | Perrysburg |
Entity Address, State or Province | OH |
Entity Address, Postal Zip Code | 43551 |
City Area Code | 567 |
Local Phone Number | 336-5000 |
Title of 12(b) Security | Common Stock, $.01 par value |
Security Exchange Name | NYSE |
Trading Symbol | OI |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Large Accelerated Filer |
Entity Small Business | false |
Entity Emerging Growth Company | false |
Entity Shell Company | false |
Entity Common Stock, Shares Outstanding | 155,137,621 |
Entity Central Index Key | 0000812074 |
Amendment Flag | false |
Document Fiscal Year Focus | 2022 |
Current Fiscal Year End Date | --12-31 |
Document Fiscal Period Focus | Q3 |
CONDENSED CONSOLIDATED RESULTS
CONDENSED CONSOLIDATED RESULTS OF OPERATIONS - USD ($) shares in Thousands, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
CONDENSED CONSOLIDATED RESULTS OF OPERATIONS | ||||
Net sales | $ 1,693 | $ 1,609 | $ 5,163 | $ 4,770 |
Revenue, Product and Service [Extensible List] | us-gaap:ProductMember | us-gaap:ProductMember | us-gaap:ProductMember | us-gaap:ProductMember |
Cost of goods sold | $ (1,368) | $ (1,307) | $ (4,209) | $ (3,916) |
Gross profit | 325 | 302 | 954 | 854 |
Selling and administrative expense | (128) | (108) | (371) | (325) |
Research, development and engineering expense | (14) | (19) | (56) | (57) |
Interest expense, net | (63) | (50) | (175) | (153) |
Equity earnings | 24 | 23 | 71 | 64 |
Other income (expense), net | 134 | (21) | 353 | (123) |
Earnings from continuing operations before income taxes | 278 | 127 | 776 | 260 |
Provision for income taxes | (43) | (43) | (164) | (144) |
Earnings from continuing operations | 235 | 84 | 612 | 116 |
Gain from discontinued operations | 7 | 7 | ||
Net earnings | 235 | 91 | 612 | 123 |
Net earnings attributable to non-controlling interests | (4) | (6) | (41) | (17) |
Net earnings attributable to the Company | 231 | 85 | 571 | 106 |
Amounts attributable to the Company: | ||||
Earnings from continuing operations | 231 | 78 | 571 | 99 |
Gain from discontinued operations | 7 | 7 | ||
Net earnings attributable to the Company | $ 231 | $ 85 | $ 571 | $ 106 |
Basic earnings per share: | ||||
Earnings from continuing operations (in dollars per share) | $ 1.49 | $ 0.49 | $ 3.67 | $ 0.62 |
Gain from discontinued operations (in dollars per share) | 0.05 | 0.05 | ||
Net earnings (in dollars per share) | $ 1.49 | $ 0.54 | $ 3.67 | $ 0.67 |
Weighted average shares outstanding (thousands) (in shares) | 155,115 | 156,825 | 155,546 | 157,430 |
Diluted earnings per share: | ||||
Earnings from continuing operations (in dollars per share) | $ 1.45 | $ 0.48 | $ 3.59 | $ 0.61 |
Gain from discontinued operations (in dollars per share) | 0.05 | 0.05 | ||
Net earnings (in dollars per share) | $ 1.45 | $ 0.53 | $ 3.59 | $ 0.66 |
Weighted average diluted shares outstanding (thousands) (in shares) | 158,935 | 160,511 | 158,892 | 160,473 |
CONDENSED CONSOLIDATED COMPREHE
CONDENSED CONSOLIDATED COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
CONDENSED CONSOLIDATED COMPREHENSIVE INCOME (LOSS) | ||||
Net earnings | $ 235 | $ 91 | $ 612 | $ 123 |
Other comprehensive income (loss): | ||||
Foreign currency translation adjustments | (99) | (110) | (86) | (81) |
Pension and other postretirement benefit adjustments, net of tax | 31 | 78 | 75 | 115 |
Change in fair value of derivative instruments, net of tax | 24 | 13 | 47 | 26 |
Other comprehensive income (loss) attributable to the Company | (44) | (19) | 36 | 60 |
Total comprehensive income | 191 | 72 | 648 | 183 |
Comprehensive (income) loss attributable to non-controlling interests | 3 | (5) | (32) | (3) |
Comprehensive income attributable to the Company | $ 194 | $ 67 | $ 616 | $ 180 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 | Sep. 30, 2021 |
Current assets: | |||
Cash and cash equivalents | $ 523 | $ 725 | $ 628 |
Trade receivables, net of allowance of $28 million, $28 million, and $31 million at September 30, 2022, December 31, 2021 and September 30, 2021 | 892 | 692 | 793 |
Inventories | 792 | 816 | 808 |
Prepaid expenses and other current assets | 223 | 237 | 213 |
Assets held for sale | 49 | ||
Total current assets | 2,430 | 2,519 | 2,442 |
Property, plant and equipment, net | 2,698 | 2,817 | 2,785 |
Goodwill | 1,730 | 1,840 | 1,879 |
Intangibles, net | 264 | 286 | 294 |
Other assets | 1,522 | 1,370 | 1,366 |
Total assets | 8,644 | 8,832 | 8,766 |
Current liabilities: | |||
Accounts payable | 1,171 | 1,210 | 1,062 |
Short-term loans and long-term debt due within one year | 331 | 72 | 79 |
Other liabilities | 594 | 551 | 597 |
Liabilities held for sale | 13 | ||
Total current liabilities | 2,096 | 1,846 | 1,738 |
Long-term debt | 4,280 | 4,753 | 4,853 |
Paddock support agreement liability | 625 | 625 | |
Other long-term liabilities | 817 | 781 | 980 |
Share owners' equity | 1,451 | 827 | 570 |
Total liabilities and share owners' equity | $ 8,644 | $ 8,832 | $ 8,766 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 | Sep. 30, 2021 |
CONDENSED CONSOLIDATED BALANCE SHEETS | |||
Trade receivables allowance | $ 28 | $ 28 | $ 31 |
CONDENSED CONSOLIDATED CASH FLO
CONDENSED CONSOLIDATED CASH FLOWS - USD ($) $ in Millions | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | ||
Cash flows from operating activities: | |||
Net earnings | $ 612 | $ 123 | |
Gain from discontinued operations | (7) | ||
Non-cash charges | |||
Depreciation and amortization | 347 | 349 | |
Pension expense | 25 | 24 | |
Charge related to Paddock support agreement liability | 154 | ||
Brazil indirect tax credit | (69) | ||
Restructuring, asset impairment and related charges | 21 | 20 | |
Pension settlement charges | 5 | 5 | |
Gain on sale of divested business | (55) | ||
Gain on sale leasebacks | (334) | ||
Cash payments | |||
Pension contributions | (22) | (33) | |
Cash paid for restructuring activities | (14) | (14) | |
Paddock Trust Settlement payment and related expenses | (618) | ||
Change in components of working capital | (162) | (139) | |
Other, net (a) | [1] | (29) | 36 |
Cash provided by (utilized in) continuing operating activities | (224) | 449 | |
Cash provided by discontinued operating activities | 7 | ||
Cash provided by (utilized in) operating activities | (224) | 456 | |
Cash flows from investing activities: | |||
Cash payments for property, plant and equipment | (346) | (268) | |
Contributions and advances to joint ventures | (11) | ||
Cash proceeds on disposal of other businesses and misc. assets | 96 | 8 | |
Cash proceeds on sale leasebacks | 368 | ||
Cash proceeds on sale of ANZ businesses, net of transaction costs | 58 | ||
Reconsolidation of reorganized Paddock | 12 | ||
Other | (11) | ||
Cash provided by (utilized in) investing activities | 108 | (202) | |
Cash flows from financing activities: | |||
Changes in borrowings, net | (4) | (119) | |
Payment of finance fees | (29) | ||
Shares repurchased | (30) | (30) | |
Net cash receipts (payments) for hedging activity | 38 | (10) | |
Distributions to non-controlling interests | (27) | (10) | |
Issuance of common stock and other | (2) | (2) | |
Cash utilized in financing activities | (54) | (171) | |
Effect of exchange rate fluctuations on cash | (32) | (18) | |
Change in cash | (202) | 65 | |
Cash at beginning of period | 725 | 563 | |
Cash at end of period | $ 523 | $ 628 | |
[1] Other, net includes other non-cash charges plus other changes in non-current assets and liabilities. |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2022 | |
Segment Information | |
Segment Information | 1. Segment Information The Company has two reportable segments and two operating segments based on its geographic locations: the Americas and Europe. These segments are aligned with the Company’s internal approach to managing, reporting, and evaluating performance of its global glass operations. Certain assets and activities not directly related to one of the segments or to glass manufacturing are reported with Retained corporate costs and other. These include licensing, equipment manufacturing, global engineering, certain equity investments and the remaining businesses in the Asia Pacific region that do not meet the criteria of an individually reportable segment after the sale of the Company’s Australia and New Zealand businesses in 2020. Retained corporate costs and other also includes certain headquarters administrative and facilities costs and certain incentive compensation and other benefit plan costs that are global in nature and are not allocable to the reportable segments. The Company’s measure of profit for its reportable segments is segment operating profit, which consists of consolidated earnings from continuing operations before interest income, interest expense, and benefit (provision) for income taxes and excludes amounts related to certain items that management considers not representative of ongoing operations and other adjustments, as well as certain retained corporate costs. The Company’s management, including the chief operating decision maker (defined as our chief executive officer), uses segment operating profit, in combination with net sales and selected cash flow information, to evaluate performance and to allocate resources. Segment operating profit for reportable segments includes an allocation of some corporate expenses based on both a percentage of sales and direct billings based on the costs of specific services provided. Segment operating profit is not a recognized term under accounting principles generally accepted in the United States (“U.S. GAAP”) and, therefore, does not purport to be an alternative to earnings from continuing operations before income taxes. Further, the Company's measure of segment operating profit may not be comparable to similarly titled measures of other companies. Financial information for the three and nine months ended September 30, 2022 and 2021 regarding the Company’s reportable segments is as follows: Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 Net sales: Americas $ 987 $ 925 $ 2,898 $ 2,652 Europe 680 655 2,153 2,039 Reportable segment totals 1,667 1,580 5,051 4,691 Other 26 29 112 79 Net sales $ 1,693 $ 1,609 $ 5,163 $ 4,770 Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 Earnings from continuing operations before income taxes $ 278 $ 127 $ 776 $ 260 Items excluded from segment operating profit: Retained corporate costs and other 63 49 165 126 Gain on sale of divested business (55) Gain on sale leasebacks (153) (334) Restructuring, asset impairment and other charges 10 12 21 21 Brazil indirect tax credit (69) Charge related to Paddock support agreement liability 154 Pension settlement charges 5 5 5 5 Interest expense, net 63 50 175 153 Segment operating profit $ 266 $ 243 $ 753 $ 650 Americas $ 130 $ 133 $ 388 $ 357 Europe 136 110 365 293 Reportable segment totals $ 266 $ 243 $ 753 $ 650 Financial information regarding the Company’s total assets is as follows: September 30, December 31, September 30, 2022 2021 2021 Total assets: Americas $ 5,020 $ 4,853 $ 4,925 Europe 3,174 3,513 3,457 Reportable segment totals 8,194 8,366 8,382 Other 450 466 384 Consolidated totals $ 8,644 $ 8,832 $ 8,766 |
Revenue
Revenue | 9 Months Ended |
Sep. 30, 2022 | |
Revenue | |
Revenue | 2. Revenue Revenue is recognized at a point in time when obligations under the terms of the Company’s contracts and related purchase orders with its customers are satisfied. This occurs with the transfer of control of glass containers, which primarily takes place when products are shipped from the Company’s manufacturing or warehousing facilities to the customer. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring goods, which includes estimated provisions for rebates, discounts, returns and allowances. Sales, value-added, and other taxes the Company collects concurrent with revenue-producing activities are excluded from revenue. The Company’s payment terms are based on customary business practices and can vary by customer type. The term between invoicing and when payment is due is not significant. Also, the Company elected to account for shipping and handling costs as a fulfillment cost at the time of shipment. For the three- and nine-month periods ended September 30, 2022 and September 30, 2021, the Company had no material bad debt expense, and there were no material contract assets, contract liabilities or deferred contract costs recorded on the Condensed Consolidated Balance Sheet. The following tables for the three months ended September 30, 2022 and 2021 disaggregate the Company’s revenue by customer end use: Three months ended September 30, 2022 Americas Europe Total Alcoholic beverages (beer, wine, spirits) $ 612 $ 509 $ 1,121 Food and other 205 113 318 Non-alcoholic beverages 170 58 228 Reportable segment totals $ 987 $ 680 $ 1,667 Other 26 Net sales $ 1,693 Three months ended September 30, 2021 Americas Europe Total Alcoholic beverages (beer, wine, spirits) $ 561 $ 467 $ 1,028 Food and other 215 124 339 Non-alcoholic beverages 149 64 213 Reportable segment totals $ 925 $ 655 $ 1,580 Other 29 Net sales $ 1,609 The following tables for the nine months ended September 30, 2022 and 2021 disaggregate the Company’s revenue by customer end use: Nine months ended September 30, 2022 Americas Europe Total Alcoholic beverages (beer, wine, spirits) $ 1,800 $ 1,621 $ 3,421 Food and other 617 345 962 Non-alcoholic beverages 481 187 668 Reportable segment totals $ 2,898 $ 2,153 $ 5,051 Other 112 Net sales $ 5,163 Nine months ended September 30, 2021 Americas Europe Total Alcoholic beverages (beer, wine, spirits) $ 1,610 $ 1,507 $ 3,117 Food and other 627 366 993 Non-alcoholic beverages 415 166 581 Reportable segment totals $ 2,652 $ 2,039 $ 4,691 Other 79 Net sales $ 4,770 |
Credit Losses
Credit Losses | 9 Months Ended |
Sep. 30, 2022 | |
Credit Losses | |
Credit Losses | 3. Credit Losses The Company is exposed to credit losses primarily through its sales of glass containers to customers. The Company’s trade receivables from customers are due within one year or less. The Company assesses each customer’s ability to pay for the glass containers it sells to them by conducting a credit review. The credit review considers the expected billing exposure and timing for payment and the customer’s established credit rating or the Company’s assessment of the customer’s creditworthiness, based on an analysis of their financial statements when a credit rating is not available. The Company also considers contract terms and conditions, country and political risk, and business strategy in its evaluation. A credit limit is established for each customer based on the outcome of this review. The Company may require collateralized asset support or a prepayment to mitigate credit risk. The Company monitors its ongoing credit exposure through the active review of customer balances against contract terms and due dates, including timely account reconciliation, dispute resolution and payment confirmation. The Company may employ collection agencies and legal counsel to pursue the recovery of defaulted receivables. At September 30, 2022 and September 30, 2021, the Company reported $892 million and $793 million of accounts receivable, respectively, net of allowances of $28 million and $31 million, respectively. Changes in the allowance were not material for each of the three and nine months ended September 30, 2022 and September 30, 2021. |
Inventories
Inventories | 9 Months Ended |
Sep. 30, 2022 | |
Inventories | |
Inventories | 4. Inventories Major classes of inventory at September 30, 2022, December 31, 2021 and September 30, 2021 are as follows: September 30, December 31, September 30, 2022 2021 2021 Finished goods $ 623 $ 659 $ 651 Raw materials 131 119 120 Operating supplies 38 38 37 $ 792 $ 816 $ 808 |
Derivative Instruments
Derivative Instruments | 9 Months Ended |
Sep. 30, 2022 | |
Derivative Instruments | |
Derivative Instruments | 5. Derivative Instruments The Company has certain derivative assets and liabilities, which consist of natural gas forwards and collars, foreign exchange option and forward contracts, interest rate swaps and cross-currency swaps. The valuation of these instruments is determined primarily using the income approach, including discounted cash flow analysis on the expected cash flows of each derivative. Natural gas prices, foreign exchange rates and interest rates are the significant inputs into the valuation models. The Company also evaluates counterparty risk in determining fair values. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. Estimates of the fair value of foreign currency and commodity derivative instruments are determined using exchange traded prices and rates. The fair values of interest rate swaps are determined using the market standard methodology of netting the discounted future fixed cash receipts (or payments) and the discounted expected variable cash payments (or receipts). The variable cash payments (or receipts) are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves. These inputs are observable in active markets over the terms of the instruments the Company holds, and, accordingly, the Company classifies its derivative assets and liabilities as Level 2 in the hierarchy. Commodity Forward Contracts and Collars Designated as Cash Flow Hedges An unrecognized loss of Cash Flow Hedges of Foreign Exchange Risk An unrecognized gain of $0 at September 30, 2022, an unrecognized gain of $6 million at December 31, 2021 and an unrecognized gain of $9 million at September 30, 2021, related to these cross-currency swaps, were included in Accumulated OCI, and will be reclassified into earnings within the next 12 months. Fair Value Hedges of Foreign Exchange Risk The Company has fixed interest rate borrowings denominated in currencies other than the functional currency of the borrowing subsidiaries. As a result, the Company is exposed to fluctuations in the currency of the borrowing against the subsidiaries’ functional currency. The Company uses derivatives to manage these exposures and designates these derivatives as fair value hedges of foreign exchange risk. Approximately $7 million and $4 million of the components were excluded from the assessment of effectiveness and are included in Accumulated OCI at September 30, 2022 and December 31, 2021, respectively. Interest Rate Swaps Designated as Fair Value Hedges The Company enters into interest rate swaps in order to maintain a capital structure containing targeted amounts of fixed and floating-rate debt and manage interest rate risk. The Company’s fixed-to-variable interest rate swaps are accounted for as fair value hedges. The relevant terms of the swap agreements match the corresponding terms of the notes, and therefore, there is no hedge ineffectiveness. The Company recorded the net of the fair market values of the swaps as a long-term liability and short-term asset, along with a corresponding net decrease in the carrying value of the hedged debt. Net Investment Hedges The Company is exposed to fluctuations in foreign exchange rates on investments it holds in non-U.S. subsidiaries and uses cross-currency swaps to partially hedge this exposure. Foreign Exchange Derivative Contracts Not Designated as Hedging Instruments The Company uses short-term forward exchange or option agreements to purchase foreign currencies at set rates in the future. These agreements are used to limit exposure to fluctuations in foreign currency exchange rates for significant planned purchases of fixed assets or commodities that are denominated in currencies other than the subsidiaries’ functional currency. The Company also uses foreign exchange agreements to offset the foreign currency exchange rate risk for receivables and payables, including intercompany receivables, payables, and loans, not denominated in, or indexed to, their functional currencies. Balance Sheet Classification The following table shows the amount and classification (as noted above) of the Company’s derivatives at September 30, 2022, December 31, 2021 and September 30, 2021: Fair Value of Fair Value of Hedge Assets Hedge Liabilities September 30, December 31, September 30, September 30, December 31, September 30, 2022 2021 2021 2022 2021 2021 Derivatives designated as hedging instruments: Commodity forward contracts and collars (a) $ 3 $ — $ — $ 2 $ — $ — Interest rate swaps - fair value hedges (b) 4 9 39 2 1 Cash flow hedges of foreign exchange risk (c) 2 9 1 23 54 Fair value hedges of foreign exchange risk (d) 68 9 Net investment hedges (e) 36 3 2 17 28 Total derivatives accounted for as hedges $ 107 $ 18 $ 20 $ 42 $ 42 $ 83 Derivatives not designated as hedges: Foreign exchange derivative contracts (f) 2 1 1 17 2 4 Total derivatives $ 109 $ 19 $ 21 $ 59 $ 44 $ 87 Current $ 25 $ 14 $ 15 $ 31 $ 2 $ 4 Noncurrent 84 5 6 28 42 83 Total derivatives $ 109 $ 19 $ 21 $ 59 $ 44 $ 87 (a) The notional amount of the commodity forward contracts and collars was approximately 44 million British Thermal Units (“BTUs”) at September 30, 2022. The maximum maturity dates are in 2027 at September 30, 2022. (b) The notional amounts of the interest rate swaps designated as fair value hedges were €725 million at September 30, 2022, December 31, 2021 and September 30, 2021. The maximum maturity dates are in 2024 at September 30, 2022, December 31, 2021 and September 30, 2021. (c) The notional amounts of the cash flow hedges of foreign exchange risk were 259 million Mexican pesos at September 30, 2022, $422 million at December 31, 2021 and $878 million at September 30, 2021. The maximum maturity dates are in 2022 at September 30, 2022 and are in 2023 at December 31, 2021 and September 30, 2021. (d) The notional amounts of the fair value hedges of foreign exchange risk were $850 million at September 30, 2022 and $400 million at December 31, 2021. The maximum maturity dates are in 2030 at September 30, 2022 and December 31, 2021. (e) The notional amounts of the net investment hedges were €324 million at September 30, 2022 and €311 million at December 31, 2021 and September 30, 2021. The maximum maturity dates are in 2026 for September 30, 2022, 2027 for December 31, 2021 and 2027 for September 30, 2021. (f) The notional amounts of the foreign exchange derivative contracts were $448 million, $202 million and $291 million at September 30, 2022, December 31, 2021 and September 30, 2021, respectively. The maximum maturity dates are in 2023 for September 30, 2022 and in 2022 for December 31, 2021 and September 30, 2021. Gain (Loss) Recognized in OCI (Effective Portion) Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) (1) Three months ended September 30, Three months ended September 30, Derivatives designated as hedging instruments: 2022 2021 2022 2021 Cash Flow Hedges Commodity forward contracts and collars(a) $ 7 $ — $ 4 $ — Cash flow hedges of foreign exchange risk (b) 24 24 Net Investment Hedges Net Investment Hedges (c) 23 14 2 1 $ 30 $ 38 $ 6 $ 25 Gain (Loss) Recognized in OCI (Effective Portion) Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) (1) Nine months ended September 30, Nine months ended September 30, Derivatives designated as hedging instruments: 2022 2021 2022 2021 Cash Flow Hedges Commodity forward contracts and collars (a) $ 4 $ — $ 6 $ — Cash flow hedges of foreign exchange risk (b) 13 56 14 57 Net Investment Hedges Net Investment Hedges (c) 55 29 5 2 $ 72 $ 85 $ 25 $ 59 Amount of Gain (Loss) Recognized in Other income (expense), net Amount of Gain (Loss) Recognized in Other income (expense), net Three months ended September 30, Nine months ended September 30, Derivatives not designated as hedges: 2022 2021 2022 2021 Foreign exchange derivative contracts $ (16) $ 2 $ (32) $ 9 (1) Gains and losses reclassified from Accumulated OCI and recognized in income are recorded to (a) cost of goods sold, (b) other income (expense), net or (c) interest expense, net. |
Restructuring Accruals
Restructuring Accruals | 9 Months Ended |
Sep. 30, 2022 | |
Restructuring Accruals | |
Restructuring Accruals | 6 . Restructuring Accruals Selected information related to the restructuring accruals for the three months ended September 30, 2022 and 2021 is as follows: Employee Asset Other Total Costs Impairment Exit Costs Restructuring Balance at July 1, 2022 $ 17 $ $ 15 $ 32 Charges 3 6 1 10 Write-down of assets to net realizable value (6) (6) Net cash paid, principally severance and related benefits (2) (4) (6) Other, including foreign exchange translation (1) (1) Balance at September 30, 2022 $ 17 $ — $ 12 $ 29 Employee Asset Other Total Costs Impairment Exit Costs Restructuring Balance at July 1, 2021 $ 32 $ — $ 12 $ 44 Charges 1 11 12 Write-down of assets to net realizable value (1) (1) Net cash paid, principally severance and related benefits (4) (1) (5) Balance at September 30, 2021 $ 28 $ — $ 22 $ 50 Selected information related to the restructuring accruals for the nine months ended September 30, 2022 and 2021 is as follows: Employee Asset Other Total Costs Impairment Exit Costs Restructuring Balance at January 1, 2022 $ 20 $ — $ 11 $ 31 Charges 6 7 8 21 Write-down of assets to net realizable value (7) (7) Net cash paid, principally severance and related benefits (7) (7) (14) Other, including foreign exchange translation (2) (2) Balance at September 30, 2022 $ 17 $ — $ 12 $ 29 Employee Asset Other Total Costs Impairment Exit Costs Restructuring Balance at January 1, 2021 $ 38 $ — $ 7 $ 45 Charges 2 1 17 20 Write-down of assets to net realizable value (1) (1) Net cash paid, principally severance and related benefits (11) (3) (14) Other, including foreign exchange translation (1) 1 — Balance at September 30, 2021 $ 28 $ — $ 22 $ 50 When a decision is made to take restructuring actions, the Company manages and accounts for them programmatically apart from the ongoing operations of the business. Information related to major programs is presented separately, while minor initiatives are presented on a combined basis. As of September 30, 2022 and 2021, no major restructuring programs were in effect. For the three and nine months ended September 30, 2022, the Company implemented several discrete restructuring initiatives and recorded restructuring and other charges of $10 million and $21 million, respectively. These charges consisted of employee costs, such as severance and benefit-related costs, asset impairments, and other exit costs (including related consulting costs attributed to restructuring of managed services activities) at a number of the Company’s locations in the Americas and Europe. These restructuring charges, which were recorded to Other income (expense), net on the Condensed Consolidated Results of Operations, were discrete actions and are expected to approximate the total cumulative costs for those actions as no significant additional costs are expected to be incurred. The Company expects that the majority of the remaining cash expenditures related to the accrued employee and other exit costs will be paid out over the next several years. For the three and nine months ended September 30, 2021, the Company implemented several discrete restructuring initiatives and recorded restructuring and other charges of $12 million and $20 million, respectively. These charges consisted of employee costs, such as severance and benefit-related costs and other exit costs (including related consulting costs attributed to restructuring of managed services activities) at a number of the Company’s locations in the Americas and Europe. These restructuring charges, which were recorded to Other income (expense), net on the Condensed Consolidated Results of Operations, were discrete actions and are expected to approximate the total cumulative costs for those actions as no significant additional costs are expected to be incurred. The Company expects that the majority of the remaining cash expenditures related to the accrued employee and other exit costs will be paid out over the next several years. The Company’s decisions to curtail selected production capacity have resulted in write-downs of certain long-lived assets to the extent their carrying value exceeded fair value or fair value less cost to sell. The Company classified the assumptions used to determine the fair value of the impaired assets in the period that the measurement was taken as Level 3 (third-party appraisal) in the fair value hierarchy as set forth in the general accounting principles for fair value measurements. For the asset impairments recorded through September 30, 2022, the remaining carrying value of the impaired assets was approximately $5 million. |
Pension Benefit Plans
Pension Benefit Plans | 9 Months Ended |
Sep. 30, 2022 | |
Pension Benefit Plans. | |
Pension Benefit Plans | 7. Pension Benefit Plans The components of the net periodic pension cost for the three months ended September 30, 2022 and 2021 are as follows: U.S. Non-U.S. Three months ended September 30, Three months ended September 30, 2022 2021 2022 2021 Service cost $ 3 $ 3 $ 2 $ 3 Interest cost 9 10 6 5 Expected asset return (15) (21) (8) (11) Amortization of actuarial loss 10 16 2 3 Net periodic pension cost $ 7 $ 8 $ 2 $ — The components of the net periodic pension cost for the nine months ended September 30, 2022 and 2021 are as follows: U.S. Non-U.S. Nine months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 Service cost $ 9 $ 9 $ 7 $ 9 Interest cost 26 30 16 15 Expected asset return (45) (63) (25) (34) Amortization of actuarial loss 30 48 7 10 Net periodic pension cost $ 20 $ 24 $ 5 $ — The components of pension expense, other than the service cost component, are included in Other income (expense), net on the Condensed Consolidated Results of Operations. The Company settled a portion of its pension obligations, which resulted in pension settlement charges of $5 million in both the three and nine months ended September 2022. The Company settled a portion of its pension obligations, which resulted in a reduction of its pension liability of approximately $46 million and pension settlement charges of $5 million in both the three and nine months ended September 30, 2021. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2022 | |
Income Taxes. | |
Income Taxes | 8. Income Taxes The Company calculates its interim tax provision using the estimated annual effective tax rate (“EAETR”) methodology in accordance with ASC 740-270. The EAETR is applied to the year-to-date ordinary income, exclusive of discrete items. The tax effects of discrete items are then included to arrive at the total reported interim tax provision. The determination of the EAETR is based upon a number of estimates, including the estimated annual pretax ordinary income or loss in each tax jurisdiction in which the Company operates. The tax effects of discrete items are recognized in the tax provision in the quarter they occur, in accordance with U.S. GAAP. Depending on various factors, such as the item’s significance in relation to total income and the rate of tax applicable in the jurisdiction to which it relates, discrete items in any quarter can materially impact the reported effective tax rate. The Company’s annual effective tax rate may be affected by the mix of earnings in the U.S. and foreign jurisdictions, and factors such as changes in tax laws, tax rates or regulations, changes in business, changing interpretation of existing tax laws or regulations, the finalization of tax audits and reviews, as well as other factors. As such, there can be significant volatility in interim tax provisions. The annual effective tax rate differs from the statutory U.S. Federal tax rate of 21% primarily because of varying non-U.S. tax rates and the impact of the U.S. valuation allowance. The Company is currently under income tax examination in various tax jurisdictions in which it operates, including Brazil, Canada, Colombia, France, Indonesia, Italy, Mexico and Peru. The years under examination range from 2004 through 2021. The Company has received tax assessments in excess of established reserves. The Company is contesting these tax assessments, and will continue to do so, including pursuing all available remedies, such as appeals and litigation, if necessary. The Company believes that adequate provisions for all income tax uncertainties have been made. However, if tax assessments are settled against the Company at amounts in excess of established reserves, it could have a material impact on the Company’s consolidated results of operations, financial position or cash flows |
Debt
Debt | 9 Months Ended |
Sep. 30, 2022 | |
Debt | |
Debt | 9. Debt The following table summarizes the long-term debt of the Company at September 30, 2022, December 31, 2021, and September 30, 2021: September 30, December 31, September 30, 2022 2021 2021 Secured Credit Agreement: Revolving Credit Facility: Revolving Loans $ — $ — $ — Term Loans: Term Loan A 1,444 Previous Secured Credit Agreement: Revolving Credit Facility: Revolving Loans Term Loans: Term Loan A 923 1,068 Other secured debt Senior Notes: 4.00%, due 2023 308 5.875%, due 2023 249 695 694 3.125%, due 2024 (€725 million) 674 826 854 6.375%, due 2025 298 297 297 5.375%, due 2025 299 298 298 2.875%, due 2025 (€500 million) 487 561 574 6.625%, due 2027 606 693 693 4.750%, due 2030 396 395 Finance leases 103 98 99 Other 4 5 5 Total long-term debt 4,560 4,791 4,890 Less amounts due within one year 280 38 37 Long-term debt $ 4,280 $ 4,753 $ 4,853 The Company presents debt issuance costs in the Condensed Consolidated Balance Sheet as a deduction of the carrying amount of the related debt liability. On March 25, 2022, certain of the Company’s subsidiaries entered into a Credit Agreement and Syndicated Facility Agreement (the “Original Agreement”), which refinanced in full the previous credit agreement. The Original Agreement provided for up to billion of borrowings pursuant to term loans, revolving credit facilities and a delayed draw term loan facility. (see Note 10 for more information). On July 18, 2022, the Company drew down the On August 30, 2022, certain of the Company’s subsidiaries entered into an Amendment No. 1 to its Credit Agreement and Syndicated Facility Agreement (the “Credit Agreement Amendment”), which amends the Original Agreement (as amended by the Credit Agreement Amendment, the “Credit Agreement”). The Credit Agreement Amendment provides for up to The term loans mature, and the revolving credit facilities terminate, in March 2027. The Company recorded approximately $1 million of additional interest charges for third-party fees and the write-off of unamortized fees related to the Credit Agreement Amendment in the third quarter of 2022. The Company recorded approximately $2 million of additional interest charges for third-party fees incurred in connection with the execution of the Original Agreement and the write-off of unamortized fees related to the previous credit agreement in the first quarter of 2022. At September 30, 2022, the Credit Agreement includes a $300 million revolving credit facility, a $950 million multicurrency revolving credit facility and $1,450 million in term loan A facilities ($1,444 million outstanding balance at September 30, 2022, net of debt issuance costs ). At September 30, 2022, the Company had unused credit of . The Credit Agreement contains various covenants that restrict, among other things and subject to certain exceptions, the ability of the Company to incur certain indebtedness and liens, make certain investments, become liable under contingent obligations in certain defined instances only, make restricted payments, make certain asset sales within guidelines and limits, engage in certain affiliate transactions, participate in sale and leaseback financing arrangements, alter its fundamental business, and amend certain subordinated debt obligations. The Credit Agreement also contains one financial maintenance covenant, a Secured Leverage Ratio (as defined in the Credit Agreement), that requires the Company not to exceed a ratio of 2.50x calculated by dividing consolidated Net Indebtedness that is then secured by Liens on property or assets of the Company and certain of its subsidiaries by Consolidated EBITDA, as each term is defined and as described in the Credit Agreement. The Secured Leverage Ratio could restrict the ability of the Company to undertake additional financing or acquisitions to the extent that such financing or acquisitions would cause the Secured Leverage Ratio to exceed the specified maximum. Failure to comply with these covenants and restrictions could result in an event of default under the Credit Agreement. In such an event, the Company could not request additional borrowings under the revolving facilities, and all amounts outstanding under the Credit Agreement, together with accrued interest, could then be declared immediately due and payable. Upon the occurrence and for the duration of a payment event of default, an additional default interest rate equal to per annum will apply to all overdue obligations under the Credit Agreement. If an event of default occurs under the Credit Agreement and the lenders cause all of the outstanding debt obligations under the Credit Agreement to become due and payable, this would result in a default under the indentures governing the Company’s outstanding debt securities and could lead to an acceleration of obligations related to these debt securities. As of September 30, 2022, the Company was in compliance with all covenants and restrictions in the Credit Agreement. In addition, the Company believes that it will remain in compliance and that its ability to borrow additional funds under the Credit Agreement will not be adversely affected by the covenants and restrictions. The Total Leverage Ratio (as defined in the Credit Agreement) determines pricing under the Credit Agreement. The interest rate on borrowings under the Agreement), plus an applicable margin. The applicable margin is linked to the Total Leverage Ratio. The margins range from for Base Rate loans. In addition, a commitment fee is payable on the unused revolving credit facility commitments ranging from Obligations under the Credit Agreement are secured by substantially all of the assets, excluding real estate and certain other excluded assets, of certain of the Company’s domestic subsidiaries and certain foreign subsidiaries. Such obligations are also secured by a pledge of intercompany debt and equity investments in certain of the Company’s domestic subsidiaries and, in the case of foreign obligations, of stock of certain foreign subsidiaries. All obligations under the Credit Agreement are guaranteed by certain domestic subsidiaries of the Company, and certain foreign obligations under the Credit Agreement are guaranteed by certain foreign subsidiaries of the Company. In August 2022, the Company redeemed $300 million aggregate principal amount of its 5.875% Senior Notes due 2023. Following the redemption, $250.0 million aggregate principal amount of the 5.875% Senior Notes due 2023 remained outstanding. The redemption was funded with cash on hand. The Company recorded approximately $7 million of additional interest charges for note repurchase premiums and the write-off of unamortized finance fees related to this redemption. On February 10, 2022, the Company announced the commencement, by an indirect wholly owned subsidiary of the Company, of a tender offer to purchase for cash up to $250.0 million aggregate purchase price of its outstanding (i) 5.875% Senior Notes due 2023, (ii) 5.375% Senior Notes due 2025, (iii) 6.375% Senior Notes due 2025 and (iv) 6.625% Senior Notes due 2027. On February 28, 2022, the Company repurchased $150.0 million aggregate principal amount of the outstanding 5.875% Senior Notes due 2023 and $88.2 million aggregate principal amount of the outstanding 6.625% Senior Notes due 2027. Following the repurchase, $550.0 million and $611.8 million aggregate principal amounts of the 5.875% Senior Notes due 2023 and 6.625% Senior Notes due 2027, respectively, remained outstanding. The repurchases were funded with cash on hand. The Company recorded approximately $16 million of additional interest charges for note repurchase premiums and the write-off of unamortized finance fees related to the senior note repurchases conducted in the first quarter of 2022. In November 2021, the Company issued $400 million aggregate principal amount of senior notes. The senior notes bear interest at a rate of 4.75% per annum and mature on February 15, 2030. The senior notes were issued via a private placement and are guaranteed by certain of the Company’s domestic subsidiaries. The net proceeds, after deducting debt issuance costs, totaled approximately $395 million and, together with cash on hand, were used to redeem the $310 million aggregate principal amount of the Company’s outstanding 4.00% Senior Notes due 2023 and approximately $128 million of term loan A borrowings under the Previous Agreement. The Company recorded approximately $13 million of additional interest charges for note repurchase premiums and write-off of unamortized finance fees related to these redemptions. In order to maintain a capital structure containing appropriate amounts of fixed and floating-rate debt, the Company has entered into a series of interest rate swap agreements. These interest rate swap agreements were accounted for as fair value hedges (see Note 5 for more information). The Company assesses its capital raising and refinancing needs on an ongoing basis and may enter into additional credit facilities and seek to issue equity and/or debt securities in the domestic and international capital markets if market conditions are favorable. Also, depending on market conditions, the Company may elect to repurchase portions of its debt securities in the open market. The carrying amounts reported for certain long-term debt obligations subject to frequently redetermined interest rates approximate fair value. Fair values for the Company’s significant fixed rate debt obligations are based on published market quotations, and are classified as Level 1 in the fair value hierarchy. Principal Indicated Market Amount Price Fair Value Senior Notes: 5.875%, due 2023 $ 250 $ 99.61 $ 249 3.125%, due 2024 (€725 million) 711 93.17 662 6.375%, due 2025 300 94.40 283 5.375%, due 2025 300 92.89 279 2.875%, due 2025 (€500 million) 490 90.16 442 6.625%, due 2027 612 90.45 554 4.750% due 2030 400 79.94 320 |
Share Owners' Equity
Share Owners' Equity | 9 Months Ended |
Sep. 30, 2022 | |
Share Owners' Equity | |
Share Owners' Equity | 11. Share Owners’ Equity The activity in share owners’ equity for the three months ended September 30, 2022 and 2021 is as follows: Share Owners’ Equity of the Company Accumulated Capital in Other Non- Total Share Common Excess of Treasury Retained Comprehensive controlling Owners' Stock Par Value Stock Earnings Loss Interests Equity Balance on July 1, 2022 $ 2 $ 3,085 (695) $ 641 $ (1,890) $ 116 $ 1,259 Reissuance of common stock (0.2 million shares) (2) 4 2 Shares repurchased (0.8 million shares) (10) (10) Stock compensation (0.0 million shares) 10 10 Net earnings 231 4 235 Other comprehensive loss (37) (7) (44) Distribution to noncontrolling interests (1) (1) Balance on September 30, 2022 $ 2 $ 3,083 $ (691) $ 872 $ (1,927) $ 112 $ 1,451 Share Owners’ Equity of the Company Accumulated Capital in Other Non- Total Share Common Excess of Treasury Retained Comprehensive controlling Owners' Stock Par Value Stock Earnings Loss Interests Equity Balance on July 1, 2021 $ 2 $ 3,113 $ (709) $ 173 $ (2,180) $ 103 $ 502 Reissuance of common stock (0.2 million shares) (1) 4 3 Shares repurchased (0.6 million shares) (10) (10) Stock compensation (0.0 million shares) 3 3 Net earnings 85 6 91 Other comprehensive loss (18) (1) (19) Balance on September 30, 2021 $ 2 $ 3,105 $ (705) $ 258 $ (2,198) $ 108 $ 570 The activity in share owners’ equity for the nine months ended September 30, 2022 and 2021 is as follows: Share Owners’ Equity of the Company Accumulated Capital in Other Non- Total Share Common Excess of Treasury Retained Comprehensive controlling Owners' Stock Par Value Stock Earnings Loss Interests Equity Balance on January 1, 2022 $ 2 $ 3,090 $ (701) $ 301 $ (1,972) $ 107 $ 827 Reissuance of common stock (0.6 million shares) (5) 13 8 Shares repurchased (2.3 million shares) (30) (30) Stock compensation (0.5 million shares) 28 28 Net earnings 571 41 612 Other comprehensive income (loss) 45 (9) 36 Distributions to noncontrolling interests (27) (27) Other (3) (3) Balance on September 30, 2022 $ 2 $ 3,083 $ (691) $ 872 $ (1,927) $ 112 $ 1,451 Share Owners’ Equity of the Company Accumulated Capital in Other Non- Total Share Common Excess of Treasury Retained Comprehensive controlling Owners' Stock Par Value Stock Earnings Loss Interests Equity Balance on January 1, 2021 $ 2 $ 3,129 $ (714) $ 152 $ (2,272) $ 104 $ 401 Issuance of common stock (0.05 million shares) 1 1 Reissuance of common stock (0.3 million shares) (4) 11 7 Shares repurchased (1.7 million shares) (30) (30) Stock compensation (0.6 million shares) 11 11 Net earnings 106 17 123 Other comprehensive income (loss) 74 (14) 60 Other (2) (2) 1 (3) Balance on September 30, 2021 $ 2 $ 3,105 $ (705) $ 258 $ (2,198) $ 108 $ 570 During the three months ended September 30, 2022, the Company purchased million. The share purchases were The Company has 250,000,000 shares of common stock authorized with a par value of $.01 per share. Shares outstanding are as follows: Shares Outstanding (in thousands) September 30, December 31, September 30, 2022 2021 2021 Shares of common stock issued (including treasury shares) 186,180 187,752 188,426 Treasury shares 31,042 31,397 31,599 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 9 Months Ended |
Sep. 30, 2022 | |
Accumulated Other Comprehensive Loss. | |
Accumulated Other Comprehensive Loss | 12. Accumulated Other Comprehensive Loss The activity in accumulated other comprehensive loss for the three months ended September 30, 2022 and 2021 is as follows: Total Accumulated Net Effect of Change in Certain Other Exchange Rate Derivative Employee Comprehensive Fluctuations Instruments Benefit Plans Loss Balance on July 1, 2022 $ (1,275) $ 2 $ (617) $ (1,890) Change before reclassifications (92) 30 (62) Amounts reclassified from accumulated other comprehensive loss (6) (a) 17 (b) 11 Translation effect 14 14 Other comprehensive income (loss) attributable to the Company (92) 24 31 (37) Balance on September 30, 2022 $ (1,367) $ 26 $ (586) $ (1,927) Total Accumulated Net Effect of Change in Certain Other Exchange Rate Derivative Employee Comprehensive Fluctuations Instruments Benefit Plans Loss Balance on July 1, 2021 $ (1,187) $ (47) $ (946) $ (2,180) Change before reclassifications (109) 37 47 (25) Amounts reclassified from accumulated other comprehensive income (loss) (25) (a) 24 (b) (1) Translation effect 7 7 Tax effect 1 1 Other comprehensive income (loss) attributable to the Company (109) 13 78 (18) Balance on September 30, 2021 $ (1,296) $ (34) $ (868) $ (2,198) (a) Amount is recorded to Other income (expense), net and interest expense, net on the Condensed Consolidated Results of Operations (see Note 5 for additional information). (b) Amount is included in the computation of net periodic pension cost (see Note 7 for additional information) and net post-retirement benefit cost. The activity in accumulated other comprehensive loss for the nine months ended September 30, 2022 and 2021 is as follows: Total Accumulated Net Effect of Change in Certain Other Exchange Rate Derivative Employee Comprehensive Fluctuations Instruments Benefit Plans Loss Balance on January 1, 2022 $ (1,290) $ (21) $ (661) $ (1,972) Change before reclassifications (77) 73 (1) (5) Amounts reclassified from accumulated other comprehensive income (loss) (25) (a) 41 (b) 16 Translation effect (1) 35 34 Other comprehensive income attributable to the Company (77) 47 75 45 Balance on September 30, 2022 $ (1,367) $ 26 $ (586) $ (1,927) Total Accumulated Net Effect of Change in Certain Other Exchange Rate Derivative Employee Comprehensive Fluctuations Instruments Benefit Plans Loss Balance on January 1, 2021 $ (1,229) $ (60) $ (983) $ (2,272) Change before reclassifications (67) 83 45 61 Amounts reclassified from accumulated other comprehensive income (loss) (59) (a) 63 (b) 4 Translation effect 1 7 8 Tax effect 1 1 Other comprehensive income (loss) attributable to the Company (67) 26 115 74 Balance on September 30, 2021 $ (1,296) $ (34) $ (868) $ (2,198) (a) Amount is recorded to Other income (expense), net and interest expense, net on the Condensed Consolidated Results of Operations (see Note 5 for additional information). (b) Amount is included in the computation of net periodic pension cost (see Note 7 for additional information) and net post-retirement benefit cost. |
Other Income (Expense), Net
Other Income (Expense), Net | 9 Months Ended |
Sep. 30, 2022 | |
Other Income (Expense), Net | |
Other Income (Expense), Net | 13. Other Income (Expense), Net Other income (expense), net for the three and nine months ended September 30, 2022 and 2021 included the following: Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 Gain on sale of divested business (see Note 17) $ $ $ 55 $ Gain on sale leasebacks (see Note 17) 153 334 Restructuring, asset impairment and other charges (10) (12) (21) (21) Brazil indirect tax credit (see Note 10) 69 Pension settlement charges (5) (5) (5) (5) Charge related to Paddock support agreement liability (see Note 10) (154) Intangible amortization expense (8) (9) (24) (26) Foreign currency exchange loss (3) (1) (4) (3) Royalty income 7 6 18 17 Other income (expense), net $ 134 $ (21) $ 353 $ (123) |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share | |
Earnings Per Share | 14. Earnings Per Share The following table sets forth the computation of basic and diluted earnings per share for the three months ended September 30, 2022 and 2021: Three months ended September 30, 2022 2021 Numerator: Net earnings attributable to the Company $ 231 $ 85 Denominator (in thousands): Denominator for basic earnings per share-weighted average shares outstanding 155,115 156,825 Effect of dilutive securities: Stock options and other 3,820 3,686 Denominator for diluted earnings per share-adjusted weighted average shares outstanding 158,935 160,511 Basic earnings per share: Earnings from continuing operations attributable to the Company $ 1.49 $ 0.49 Gain from discontinued operations 0.05 Net earnings attributable to the Company $ 1.49 $ 0.54 Diluted earnings per share: Earnings from continuing operations attributable to the Company $ 1.45 $ 0.48 Gain from discontinued operations 0.05 Net earnings attributable to the Company $ 1.45 $ 0.53 The diluted earnings per share computation for the three months ended September 30, 2022 and 2021 excludes 724,186 and 958,014 weighted average shares of common stock, respectively, due to their antidilutive effect, which includes options to purchase, unvested restricted stock units and performance vested restricted share units. Options to purchase shares were excluded because the exercise prices of the options were greater than the average market price of the shares of common stock. The following table sets forth the computation of basic and diluted earnings per share for the nine months ended September 30, 2022 and 2021: Nine months ended September 30, 2022 2021 Numerator: Net earnings attributable to the Company $ 571 $ 106 Denominator (in thousands): Denominator for basic earnings per share-weighted average shares outstanding 155,546 157,430 Effect of dilutive securities: Stock options and other 3,346 3,043 Denominator for diluted earnings per share-adjusted weighted average shares outstanding 158,892 160,473 Basic earnings per share: Earnings from continuing operations attributable to the Company $ 3.67 $ 0.62 Gain from discontinued operations 0.05 Net earnings attributable to the Company $ 3.67 $ 0.67 Diluted earnings per share: Earnings from continuing operations attributable to the Company $ 3.59 $ 0.61 Gain from discontinued operations 0.05 Net earnings attributable to the Company $ 3.59 $ 0.66 The diluted earnings per share computation for the nine months ended September 30, 2022 and 2021 excludes 1,035,227 and 1,206,870 weighted average shares of common stock, respectively, due to their antidilutive effect, which includes options to purchase, unvested restricted stock units and performance vested restricted share units. Options to purchase shares were excluded because the exercise prices of the options were greater than the average market price of the shares of common stock. |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 9 Months Ended |
Sep. 30, 2022 | |
Supplemental Cash Flow Information | |
Supplemental Cash Flow Information | 15. Supplemental Cash Flow Information Income taxes paid in cash were as follows: Nine months ended September 30, 2022 2021 U.S. $ 9 $ 6 Non-U.S. 128 58 Total income taxes paid in cash $ 137 $ 64 Interest paid, including note repurchase premiums, in cash for the nine months ended September 30, 2022 and 2021 was The Company uses various factoring programs to sell certain receivables to financial institutions as part of managing its cash flows. At September 30, 2022, December 31, 2021 and September 30, 2021, the amount of receivables sold by the Company was These amounts included $174 million, $180 million and $189 million at September 30, 2022, December 31, 2021, and September 30, 2021, respectively, for trade receivable amounts factored under supply chain financing programs linked to commercial arrangements with key customers. million for the same period in 2021. For the nine months ended September 30, 2022 and 2021, the Company recorded expenses related to these factoring programs of approximately |
COVID-19 Impacts
COVID-19 Impacts | 9 Months Ended |
Sep. 30, 2022 | |
COVID-19 Impacts | |
COVID-19 Impacts | 16. COVID-19 Impacts On March 11, 2020, the World Health Organization characterized COVID-19 as a global pandemic and recommended containment and mitigation measures. The Company is actively monitoring the impact of the COVID-19 pandemic, which negatively impacted its business in 2020 and, to a lesser extent, in 2021 and the first nine months of 2022 and may negatively impact its business and results of operations in the future. The preparation of Condensed Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates particularly as it relates to estimates reliant on forecasts and other assumptions reasonably available to the Company and the uncertain future impacts of the COVID-19 pandemic and related economic disruptions. The extent to which the COVID-19 pandemic and related economic disruptions impact the Company’s business and financial results will depend on future developments including, but not limited to, the continued spread, duration and severity of the COVID-19 pandemic; the occurrence, spread, duration and severity of any subsequent wave or waves of outbreaks after the initial outbreak has subsided; the actions taken by the U.S. and foreign governments to contain the COVID-19 pandemic, address its impact or respond to the reduction in global and local economic activity; the occurrence, duration and severity of a global, regional or national recession, depression or other sustained adverse market event; the impact of the developments described above on its customers and suppliers; and how quickly and to what extent normal economic and operating conditions can resume. The accounting matters assessed included, but were not limited to: ● allowance for doubtful accounts and credit losses; ● carrying value of inventory; and ● the carrying value of goodwill and other long-lived assets. There was not a material impact to the above estimates in the Company’s Condensed Consolidated Financial Statements for the nine-month period ended September 30, 2022 or September 30, 2021. The Company’s future assessment of the magnitude and duration of the COVID-19 pandemic, as well as other factors, could result in material changes to the estimates and material impacts to the Company’s Condensed Consolidated Financial Statements in future reporting periods. |
Divestitures and Sale Leaseback
Divestitures and Sale Leasebacks of Land and Building | 9 Months Ended |
Sep. 30, 2022 | |
Divestitures and Sale Leasebacks of Land and Building | |
Divestitures and Sale Leasebacks of Land and Building | 17. Divestitures and Sale Leasebacks of Land and Building In August 2022, the Company completed the sale of the land and building related to its Vernon, California (Los Angeles) plant to 2900 Fruitland Avenue Investors LLC and 2901 Fruitland Avenue Investors LLC (“Fruitland”). Proceeds from the sale were approximately $181 million and the Company recorded a pretax gain of approximately $153 million (approximately $153 million after tax) on the sale, which is reflected in Other income (expense), net on the Condensed Consolidated Results of Operations. In connection with this transaction, the Company entered into a lease for the land and building with Fruitland for the Vernon, California plant for an initial term of 10 years. The lease requires the Company to make rent payments of approximately $7.2 million in the first year, gradually increasing to approximately $10.3 million in the tenth year. The lease is classified as operating and was recorded as a right-of-use asset current noncurrent In May 2022, the Company completed the sale of the land and building related to its Brampton, Ontario, Canada plant to an affiliate of Crestpoint Real Estate Investments Ltd. (“Crestpoint”). Net proceeds were approximately $190 million, and the Company recorded a pretax gain of approximately $182 million (approximately $158 million after tax) on the sale, which is reflected in Other income (expense), net on the Condensed Consolidated Results of Operations. In connection with this transaction, the Company entered into a lease for the land and building with Crestpoint for the Brampton, Ontario plant for an initial term of 10 years. The lease requires the Company to make rent payments of approximately $7.3 million in the first year, gradually increasing to approximately $9.1 million in the tenth year. The lease is classified as operating and was recorded as a right-of-use asset current noncurrent In March 2022, the Company completed the sale of its Cristar TableTop S.A.S. business to Vidros Colombia S.A.S, an affiliate of Nadir Figueiredo S.A., a glass tableware producer based in Brazil. Gross proceeds received were approximately $96 million and the related pretax gain recorded was approximately $55 million (approximately $16 million after tax and non-controlling interest) in the first quarter of 2022. The pretax gain was recorded to Other income (expense), net on the Condensed Consolidated Results of Operations. In January 2021, the Company completed the sale of its plant in Argentina. Gross proceeds were approximately $10 million, and the gain on the sale was not material. |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Segment Information | |
Net sales for the Company's reportable segments | Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 Net sales: Americas $ 987 $ 925 $ 2,898 $ 2,652 Europe 680 655 2,153 2,039 Reportable segment totals 1,667 1,580 5,051 4,691 Other 26 29 112 79 Net sales $ 1,693 $ 1,609 $ 5,163 $ 4,770 |
Segment operating profit (loss) for the Company's reportable segments | Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 Earnings from continuing operations before income taxes $ 278 $ 127 $ 776 $ 260 Items excluded from segment operating profit: Retained corporate costs and other 63 49 165 126 Gain on sale of divested business (55) Gain on sale leasebacks (153) (334) Restructuring, asset impairment and other charges 10 12 21 21 Brazil indirect tax credit (69) Charge related to Paddock support agreement liability 154 Pension settlement charges 5 5 5 5 Interest expense, net 63 50 175 153 Segment operating profit $ 266 $ 243 $ 753 $ 650 Americas $ 130 $ 133 $ 388 $ 357 Europe 136 110 365 293 Reportable segment totals $ 266 $ 243 $ 753 $ 650 |
Total assets for the Company's reportable segments | September 30, December 31, September 30, 2022 2021 2021 Total assets: Americas $ 5,020 $ 4,853 $ 4,925 Europe 3,174 3,513 3,457 Reportable segment totals 8,194 8,366 8,382 Other 450 466 384 Consolidated totals $ 8,644 $ 8,832 $ 8,766 |
Revenue (Tables)
Revenue (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Revenue | |
Schedule of disaggregation of revenue by customer end use | The following tables for the three months ended September 30, 2022 and 2021 disaggregate the Company’s revenue by customer end use: Three months ended September 30, 2022 Americas Europe Total Alcoholic beverages (beer, wine, spirits) $ 612 $ 509 $ 1,121 Food and other 205 113 318 Non-alcoholic beverages 170 58 228 Reportable segment totals $ 987 $ 680 $ 1,667 Other 26 Net sales $ 1,693 Three months ended September 30, 2021 Americas Europe Total Alcoholic beverages (beer, wine, spirits) $ 561 $ 467 $ 1,028 Food and other 215 124 339 Non-alcoholic beverages 149 64 213 Reportable segment totals $ 925 $ 655 $ 1,580 Other 29 Net sales $ 1,609 The following tables for the nine months ended September 30, 2022 and 2021 disaggregate the Company’s revenue by customer end use: |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Inventories | |
Major classes of inventory | September 30, December 31, September 30, 2022 2021 2021 Finished goods $ 623 $ 659 $ 651 Raw materials 131 119 120 Operating supplies 38 38 37 $ 792 $ 816 $ 808 |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Derivative Instruments | |
Balance Sheet Classification of derivative instruments | Fair Value of Fair Value of Hedge Assets Hedge Liabilities September 30, December 31, September 30, September 30, December 31, September 30, 2022 2021 2021 2022 2021 2021 Derivatives designated as hedging instruments: Commodity forward contracts and collars (a) $ 3 $ — $ — $ 2 $ — $ — Interest rate swaps - fair value hedges (b) 4 9 39 2 1 Cash flow hedges of foreign exchange risk (c) 2 9 1 23 54 Fair value hedges of foreign exchange risk (d) 68 9 Net investment hedges (e) 36 3 2 17 28 Total derivatives accounted for as hedges $ 107 $ 18 $ 20 $ 42 $ 42 $ 83 Derivatives not designated as hedges: Foreign exchange derivative contracts (f) 2 1 1 17 2 4 Total derivatives $ 109 $ 19 $ 21 $ 59 $ 44 $ 87 Current $ 25 $ 14 $ 15 $ 31 $ 2 $ 4 Noncurrent 84 5 6 28 42 83 Total derivatives $ 109 $ 19 $ 21 $ 59 $ 44 $ 87 (a) The notional amount of the commodity forward contracts and collars was approximately 44 million British Thermal Units (“BTUs”) at September 30, 2022. The maximum maturity dates are in 2027 at September 30, 2022. (b) The notional amounts of the interest rate swaps designated as fair value hedges were €725 million at September 30, 2022, December 31, 2021 and September 30, 2021. The maximum maturity dates are in 2024 at September 30, 2022, December 31, 2021 and September 30, 2021. (c) The notional amounts of the cash flow hedges of foreign exchange risk were 259 million Mexican pesos at September 30, 2022, $422 million at December 31, 2021 and $878 million at September 30, 2021. The maximum maturity dates are in 2022 at September 30, 2022 and are in 2023 at December 31, 2021 and September 30, 2021. (d) The notional amounts of the fair value hedges of foreign exchange risk were $850 million at September 30, 2022 and $400 million at December 31, 2021. The maximum maturity dates are in 2030 at September 30, 2022 and December 31, 2021. (e) The notional amounts of the net investment hedges were €324 million at September 30, 2022 and €311 million at December 31, 2021 and September 30, 2021. The maximum maturity dates are in 2026 for September 30, 2022, 2027 for December 31, 2021 and 2027 for September 30, 2021. (f) The notional amounts of the foreign exchange derivative contracts were $448 million, $202 million and $291 million at September 30, 2022, December 31, 2021 and September 30, 2021, respectively. The maximum maturity dates are in 2023 for September 30, 2022 and in 2022 for December 31, 2021 and September 30, 2021. |
Effects of derivative instruments on the results of operations | Gain (Loss) Recognized in OCI (Effective Portion) Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) (1) Three months ended September 30, Three months ended September 30, Derivatives designated as hedging instruments: 2022 2021 2022 2021 Cash Flow Hedges Commodity forward contracts and collars(a) $ 7 $ — $ 4 $ — Cash flow hedges of foreign exchange risk (b) 24 24 Net Investment Hedges Net Investment Hedges (c) 23 14 2 1 $ 30 $ 38 $ 6 $ 25 Gain (Loss) Recognized in OCI (Effective Portion) Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) (1) Nine months ended September 30, Nine months ended September 30, Derivatives designated as hedging instruments: 2022 2021 2022 2021 Cash Flow Hedges Commodity forward contracts and collars (a) $ 4 $ — $ 6 $ — Cash flow hedges of foreign exchange risk (b) 13 56 14 57 Net Investment Hedges Net Investment Hedges (c) 55 29 5 2 $ 72 $ 85 $ 25 $ 59 Amount of Gain (Loss) Recognized in Other income (expense), net Amount of Gain (Loss) Recognized in Other income (expense), net Three months ended September 30, Nine months ended September 30, Derivatives not designated as hedges: 2022 2021 2022 2021 Foreign exchange derivative contracts $ (16) $ 2 $ (32) $ 9 (1) Gains and losses reclassified from Accumulated OCI and recognized in income are recorded to (a) cost of goods sold, (b) other income (expense), net or (c) interest expense, net. |
Restructuring Accruals (Tables)
Restructuring Accruals (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Restructuring Accruals | |
Selected information related to the restructuring accruals | Selected information related to the restructuring accruals for the three months ended September 30, 2022 and 2021 is as follows: Employee Asset Other Total Costs Impairment Exit Costs Restructuring Balance at July 1, 2022 $ 17 $ $ 15 $ 32 Charges 3 6 1 10 Write-down of assets to net realizable value (6) (6) Net cash paid, principally severance and related benefits (2) (4) (6) Other, including foreign exchange translation (1) (1) Balance at September 30, 2022 $ 17 $ — $ 12 $ 29 Employee Asset Other Total Costs Impairment Exit Costs Restructuring Balance at July 1, 2021 $ 32 $ — $ 12 $ 44 Charges 1 11 12 Write-down of assets to net realizable value (1) (1) Net cash paid, principally severance and related benefits (4) (1) (5) Balance at September 30, 2021 $ 28 $ — $ 22 $ 50 Selected information related to the restructuring accruals for the nine months ended September 30, 2022 and 2021 is as follows: Employee Asset Other Total Costs Impairment Exit Costs Restructuring Balance at January 1, 2022 $ 20 $ — $ 11 $ 31 Charges 6 7 8 21 Write-down of assets to net realizable value (7) (7) Net cash paid, principally severance and related benefits (7) (7) (14) Other, including foreign exchange translation (2) (2) Balance at September 30, 2022 $ 17 $ — $ 12 $ 29 Employee Asset Other Total Costs Impairment Exit Costs Restructuring Balance at January 1, 2021 $ 38 $ — $ 7 $ 45 Charges 2 1 17 20 Write-down of assets to net realizable value (1) (1) Net cash paid, principally severance and related benefits (11) (3) (14) Other, including foreign exchange translation (1) 1 — Balance at September 30, 2021 $ 28 $ — $ 22 $ 50 |
Pension Benefit Plans (Tables)
Pension Benefit Plans (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Pension Benefit Plans | |
Defined Benefit Plans and Other Postretirement Benefit Plans | |
Components of net periodic pension cost | The components of the net periodic pension cost for the three months ended September 30, 2022 and 2021 are as follows: U.S. Non-U.S. Three months ended September 30, Three months ended September 30, 2022 2021 2022 2021 Service cost $ 3 $ 3 $ 2 $ 3 Interest cost 9 10 6 5 Expected asset return (15) (21) (8) (11) Amortization of actuarial loss 10 16 2 3 Net periodic pension cost $ 7 $ 8 $ 2 $ — The components of the net periodic pension cost for the nine months ended September 30, 2022 and 2021 are as follows: U.S. Non-U.S. Nine months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 Service cost $ 9 $ 9 $ 7 $ 9 Interest cost 26 30 16 15 Expected asset return (45) (63) (25) (34) Amortization of actuarial loss 30 48 7 10 Net periodic pension cost $ 20 $ 24 $ 5 $ — |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Debt | |
Long-term Debt | September 30, December 31, September 30, 2022 2021 2021 Secured Credit Agreement: Revolving Credit Facility: Revolving Loans $ — $ — $ — Term Loans: Term Loan A 1,444 Previous Secured Credit Agreement: Revolving Credit Facility: Revolving Loans Term Loans: Term Loan A 923 1,068 Other secured debt Senior Notes: 4.00%, due 2023 308 5.875%, due 2023 249 695 694 3.125%, due 2024 (€725 million) 674 826 854 6.375%, due 2025 298 297 297 5.375%, due 2025 299 298 298 2.875%, due 2025 (€500 million) 487 561 574 6.625%, due 2027 606 693 693 4.750%, due 2030 396 395 Finance leases 103 98 99 Other 4 5 5 Total long-term debt 4,560 4,791 4,890 Less amounts due within one year 280 38 37 Long-term debt $ 4,280 $ 4,753 $ 4,853 |
Fair values of the Company's significant fixed rate debt obligations | Principal Indicated Market Amount Price Fair Value Senior Notes: 5.875%, due 2023 $ 250 $ 99.61 $ 249 3.125%, due 2024 (€725 million) 711 93.17 662 6.375%, due 2025 300 94.40 283 5.375%, due 2025 300 92.89 279 2.875%, due 2025 (€500 million) 490 90.16 442 6.625%, due 2027 612 90.45 554 4.750% due 2030 400 79.94 320 |
Share Owners' Equity (Tables)
Share Owners' Equity (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Share Owners' Equity | |
Activity in share owner's equity | The activity in share owners’ equity for the three months ended September 30, 2022 and 2021 is as follows: Share Owners’ Equity of the Company Accumulated Capital in Other Non- Total Share Common Excess of Treasury Retained Comprehensive controlling Owners' Stock Par Value Stock Earnings Loss Interests Equity Balance on July 1, 2022 $ 2 $ 3,085 (695) $ 641 $ (1,890) $ 116 $ 1,259 Reissuance of common stock (0.2 million shares) (2) 4 2 Shares repurchased (0.8 million shares) (10) (10) Stock compensation (0.0 million shares) 10 10 Net earnings 231 4 235 Other comprehensive loss (37) (7) (44) Distribution to noncontrolling interests (1) (1) Balance on September 30, 2022 $ 2 $ 3,083 $ (691) $ 872 $ (1,927) $ 112 $ 1,451 Share Owners’ Equity of the Company Accumulated Capital in Other Non- Total Share Common Excess of Treasury Retained Comprehensive controlling Owners' Stock Par Value Stock Earnings Loss Interests Equity Balance on July 1, 2021 $ 2 $ 3,113 $ (709) $ 173 $ (2,180) $ 103 $ 502 Reissuance of common stock (0.2 million shares) (1) 4 3 Shares repurchased (0.6 million shares) (10) (10) Stock compensation (0.0 million shares) 3 3 Net earnings 85 6 91 Other comprehensive loss (18) (1) (19) Balance on September 30, 2021 $ 2 $ 3,105 $ (705) $ 258 $ (2,198) $ 108 $ 570 The activity in share owners’ equity for the nine months ended September 30, 2022 and 2021 is as follows: Share Owners’ Equity of the Company Accumulated Capital in Other Non- Total Share Common Excess of Treasury Retained Comprehensive controlling Owners' Stock Par Value Stock Earnings Loss Interests Equity Balance on January 1, 2022 $ 2 $ 3,090 $ (701) $ 301 $ (1,972) $ 107 $ 827 Reissuance of common stock (0.6 million shares) (5) 13 8 Shares repurchased (2.3 million shares) (30) (30) Stock compensation (0.5 million shares) 28 28 Net earnings 571 41 612 Other comprehensive income (loss) 45 (9) 36 Distributions to noncontrolling interests (27) (27) Other (3) (3) Balance on September 30, 2022 $ 2 $ 3,083 $ (691) $ 872 $ (1,927) $ 112 $ 1,451 Share Owners’ Equity of the Company Accumulated Capital in Other Non- Total Share Common Excess of Treasury Retained Comprehensive controlling Owners' Stock Par Value Stock Earnings Loss Interests Equity Balance on January 1, 2021 $ 2 $ 3,129 $ (714) $ 152 $ (2,272) $ 104 $ 401 Issuance of common stock (0.05 million shares) 1 1 Reissuance of common stock (0.3 million shares) (4) 11 7 Shares repurchased (1.7 million shares) (30) (30) Stock compensation (0.6 million shares) 11 11 Net earnings 106 17 123 Other comprehensive income (loss) 74 (14) 60 Other (2) (2) 1 (3) Balance on September 30, 2021 $ 2 $ 3,105 $ (705) $ 258 $ (2,198) $ 108 $ 570 |
Schedule of shares outstanding | Shares Outstanding (in thousands) September 30, December 31, September 30, 2022 2021 2021 Shares of common stock issued (including treasury shares) 186,180 187,752 188,426 Treasury shares 31,042 31,397 31,599 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Loss (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Accumulated Other Comprehensive Loss. | |
Component of accumulated other comprehensive loss | The activity in accumulated other comprehensive loss for the three months ended September 30, 2022 and 2021 is as follows: Total Accumulated Net Effect of Change in Certain Other Exchange Rate Derivative Employee Comprehensive Fluctuations Instruments Benefit Plans Loss Balance on July 1, 2022 $ (1,275) $ 2 $ (617) $ (1,890) Change before reclassifications (92) 30 (62) Amounts reclassified from accumulated other comprehensive loss (6) (a) 17 (b) 11 Translation effect 14 14 Other comprehensive income (loss) attributable to the Company (92) 24 31 (37) Balance on September 30, 2022 $ (1,367) $ 26 $ (586) $ (1,927) Total Accumulated Net Effect of Change in Certain Other Exchange Rate Derivative Employee Comprehensive Fluctuations Instruments Benefit Plans Loss Balance on July 1, 2021 $ (1,187) $ (47) $ (946) $ (2,180) Change before reclassifications (109) 37 47 (25) Amounts reclassified from accumulated other comprehensive income (loss) (25) (a) 24 (b) (1) Translation effect 7 7 Tax effect 1 1 Other comprehensive income (loss) attributable to the Company (109) 13 78 (18) Balance on September 30, 2021 $ (1,296) $ (34) $ (868) $ (2,198) (a) Amount is recorded to Other income (expense), net and interest expense, net on the Condensed Consolidated Results of Operations (see Note 5 for additional information). (b) Amount is included in the computation of net periodic pension cost (see Note 7 for additional information) and net post-retirement benefit cost. The activity in accumulated other comprehensive loss for the nine months ended September 30, 2022 and 2021 is as follows: Total Accumulated Net Effect of Change in Certain Other Exchange Rate Derivative Employee Comprehensive Fluctuations Instruments Benefit Plans Loss Balance on January 1, 2022 $ (1,290) $ (21) $ (661) $ (1,972) Change before reclassifications (77) 73 (1) (5) Amounts reclassified from accumulated other comprehensive income (loss) (25) (a) 41 (b) 16 Translation effect (1) 35 34 Other comprehensive income attributable to the Company (77) 47 75 45 Balance on September 30, 2022 $ (1,367) $ 26 $ (586) $ (1,927) Total Accumulated Net Effect of Change in Certain Other Exchange Rate Derivative Employee Comprehensive Fluctuations Instruments Benefit Plans Loss Balance on January 1, 2021 $ (1,229) $ (60) $ (983) $ (2,272) Change before reclassifications (67) 83 45 61 Amounts reclassified from accumulated other comprehensive income (loss) (59) (a) 63 (b) 4 Translation effect 1 7 8 Tax effect 1 1 Other comprehensive income (loss) attributable to the Company (67) 26 115 74 Balance on September 30, 2021 $ (1,296) $ (34) $ (868) $ (2,198) (a) Amount is recorded to Other income (expense), net and interest expense, net on the Condensed Consolidated Results of Operations (see Note 5 for additional information). (b) Amount is included in the computation of net periodic pension cost (see Note 7 for additional information) and net post-retirement benefit cost. |
Other Income (Expense), Net (Ta
Other Income (Expense), Net (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Other Income (Expense), Net | |
Schedule of other income (expense), net | Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 Gain on sale of divested business (see Note 17) $ $ $ 55 $ Gain on sale leasebacks (see Note 17) 153 334 Restructuring, asset impairment and other charges (10) (12) (21) (21) Brazil indirect tax credit (see Note 10) 69 Pension settlement charges (5) (5) (5) (5) Charge related to Paddock support agreement liability (see Note 10) (154) Intangible amortization expense (8) (9) (24) (26) Foreign currency exchange loss (3) (1) (4) (3) Royalty income 7 6 18 17 Other income (expense), net $ 134 $ (21) $ 353 $ (123) |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share | |
Computation of basic and diluted earnings per share | Three months ended September 30, 2022 2021 Numerator: Net earnings attributable to the Company $ 231 $ 85 Denominator (in thousands): Denominator for basic earnings per share-weighted average shares outstanding 155,115 156,825 Effect of dilutive securities: Stock options and other 3,820 3,686 Denominator for diluted earnings per share-adjusted weighted average shares outstanding 158,935 160,511 Basic earnings per share: Earnings from continuing operations attributable to the Company $ 1.49 $ 0.49 Gain from discontinued operations 0.05 Net earnings attributable to the Company $ 1.49 $ 0.54 Diluted earnings per share: Earnings from continuing operations attributable to the Company $ 1.45 $ 0.48 Gain from discontinued operations 0.05 Net earnings attributable to the Company $ 1.45 $ 0.53 Nine months ended September 30, 2022 2021 Numerator: Net earnings attributable to the Company $ 571 $ 106 Denominator (in thousands): Denominator for basic earnings per share-weighted average shares outstanding 155,546 157,430 Effect of dilutive securities: Stock options and other 3,346 3,043 Denominator for diluted earnings per share-adjusted weighted average shares outstanding 158,892 160,473 Basic earnings per share: Earnings from continuing operations attributable to the Company $ 3.67 $ 0.62 Gain from discontinued operations 0.05 Net earnings attributable to the Company $ 3.67 $ 0.67 Diluted earnings per share: Earnings from continuing operations attributable to the Company $ 3.59 $ 0.61 Gain from discontinued operations 0.05 Net earnings attributable to the Company $ 3.59 $ 0.66 |
Supplemental Cash Flow Inform_2
Supplemental Cash Flow Information (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Supplemental Cash Flow Information | |
Income taxes paid (received) in cash | Nine months ended September 30, 2022 2021 U.S. $ 9 $ 6 Non-U.S. 128 58 Total income taxes paid in cash $ 137 $ 64 |
Segment Information (Details)
Segment Information (Details) | 9 Months Ended |
Sep. 30, 2022 segment | |
Segment Information | |
Number of reportable segments | 2 |
Number of operating segments | 2 |
Segment Information - Reportabl
Segment Information - Reportable Segments - Net Sales (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Net sales: | ||||
Net sales | $ 1,693 | $ 1,609 | $ 5,163 | $ 4,770 |
Reportable Segment Totals | ||||
Net sales: | ||||
Net sales | 1,667 | 1,580 | 5,051 | 4,691 |
Americas | ||||
Net sales: | ||||
Net sales | 987 | 925 | 2,898 | 2,652 |
Europe | ||||
Net sales: | ||||
Net sales | 680 | 655 | 2,153 | 2,039 |
Other | ||||
Net sales: | ||||
Net sales | $ 26 | $ 29 | $ 112 | $ 79 |
Segment Information - Reporta_2
Segment Information - Reportable Segments - Segment Operating Profits and Reporting Segment Totals (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Segment operating profit: | |||||
Earnings (loss) before income taxes | $ 278 | $ 127 | $ 776 | $ 260 | |
Items excluded from segment operating profit: | |||||
Retained corporate costs and other | 63 | 49 | 165 | 126 | |
Gain on sale of divested business | (55) | ||||
Gain on sale leasebacks | (153) | (334) | |||
Restructuring, asset impairment and other charges | 10 | 12 | 21 | 21 | |
Brazil indirect tax credit | $ (69) | (69) | |||
Charge related to Paddock support agreement | 154 | ||||
Pension settlement charges | 5 | 5 | 5 | 5 | |
Interest expense, net | 63 | 50 | 175 | 153 | |
Segment operating profit | |||||
Segment operating profit | 266 | 243 | 753 | 650 | |
Americas | |||||
Segment operating profit | |||||
Segment operating profit | 130 | 133 | 388 | 357 | |
Europe | |||||
Segment operating profit | |||||
Segment operating profit | $ 136 | $ 110 | $ 365 | $ 293 |
Segment Information - Total Ass
Segment Information - Total Assets (Details) - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 | Sep. 30, 2021 |
Assets | |||
Total assets: | $ 8,644 | $ 8,832 | $ 8,766 |
Reportable Segment Totals | |||
Assets | |||
Total assets: | 8,194 | 8,366 | 8,382 |
Americas | |||
Assets | |||
Total assets: | 5,020 | 4,853 | 4,925 |
Europe | |||
Assets | |||
Total assets: | 3,174 | 3,513 | 3,457 |
Other | |||
Assets | |||
Total assets: | $ 450 | $ 466 | $ 384 |
Revenue (Details)
Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Disaggregation of Revenue | ||||
Net sales | $ 1,693 | $ 1,609 | $ 5,163 | $ 4,770 |
Reportable Segment Totals | ||||
Disaggregation of Revenue | ||||
Net sales | 1,667 | 1,580 | 5,051 | 4,691 |
Americas | ||||
Disaggregation of Revenue | ||||
Net sales | 987 | 925 | 2,898 | 2,652 |
Europe | ||||
Disaggregation of Revenue | ||||
Net sales | 680 | 655 | 2,153 | 2,039 |
Other | ||||
Disaggregation of Revenue | ||||
Net sales | 26 | 29 | 112 | 79 |
Alcoholic beverages (beer, wine, spirits) | ||||
Disaggregation of Revenue | ||||
Net sales | 1,121 | 1,028 | 3,421 | 3,117 |
Alcoholic beverages (beer, wine, spirits) | Americas | ||||
Disaggregation of Revenue | ||||
Net sales | 612 | 561 | 1,800 | 1,610 |
Alcoholic beverages (beer, wine, spirits) | Europe | ||||
Disaggregation of Revenue | ||||
Net sales | 509 | 467 | 1,621 | 1,507 |
Food and other | ||||
Disaggregation of Revenue | ||||
Net sales | 318 | 339 | 962 | 993 |
Food and other | Americas | ||||
Disaggregation of Revenue | ||||
Net sales | 205 | 215 | 617 | 627 |
Food and other | Europe | ||||
Disaggregation of Revenue | ||||
Net sales | 113 | 124 | 345 | 366 |
Non-alcoholic beverages | ||||
Disaggregation of Revenue | ||||
Net sales | 228 | 213 | 668 | 581 |
Non-alcoholic beverages | Americas | ||||
Disaggregation of Revenue | ||||
Net sales | 170 | 149 | 481 | 415 |
Non-alcoholic beverages | Europe | ||||
Disaggregation of Revenue | ||||
Net sales | $ 58 | $ 64 | $ 187 | $ 166 |
Credit Losses (Details)
Credit Losses (Details) - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 | Sep. 30, 2021 |
Credit Losses | |||
Accounts receivable, net | $ 892 | $ 692 | $ 793 |
Allowance for doubtful accounts | $ 28 | $ 28 | $ 31 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 | Sep. 30, 2021 |
Inventories | |||
Finished goods | $ 623 | $ 659 | $ 651 |
Raw materials | 131 | 119 | 120 |
Operating supplies | 38 | 38 | 37 |
Inventories | $ 792 | $ 816 | $ 808 |
Derivative Instruments - Deriva
Derivative Instruments - Derivatives and Hedges (Details) - USD ($) $ in Millions | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | |
Commodity forward contracts and collars | Cash Flow Hedges | |||
Derivatives and Hedges | |||
Unrecognized gain (loss) included in Accumulated OCI | $ (2) | ||
Foreign exchange risk | Cash Flow Hedges | |||
Derivatives and Hedges | |||
Unrecognized gain (loss) included in Accumulated OCI | 0 | $ 6 | $ 9 |
Foreign exchange risk | Fair Value Hedges | |||
Derivatives and Hedges | |||
Amount excluded from assessment of effectiveness and included in Accumulated OCI | $ 7 | $ 4 |
Derivative Instruments - Balanc
Derivative Instruments - Balance Sheet Classification (Details) € in Millions, $ / BTU in Millions, $ in Millions, $ in Millions | 9 Months Ended | ||||||
Sep. 30, 2022 USD ($) $ / BTU | Sep. 30, 2022 EUR (€) | Sep. 30, 2022 MXN ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2021 EUR (€) | Sep. 30, 2021 USD ($) | Sep. 30, 2021 EUR (€) | |
Derivatives, Fair Value | |||||||
Total asset derivatives | $ 109 | $ 19 | $ 21 | ||||
Total liability derivatives | 59 | 44 | 87 | ||||
Current derivative asset | 25 | 14 | 15 | ||||
Current derivative liability | 31 | 2 | 4 | ||||
Noncurrent derivative asset | 84 | 5 | 6 | ||||
Noncurrent derivative liability | 28 | 42 | 83 | ||||
Derivatives designated as hedging instruments | |||||||
Derivatives, Fair Value | |||||||
Total asset derivatives | 107 | 18 | 20 | ||||
Total liability derivatives | $ 42 | 42 | 83 | ||||
Derivatives designated as hedging instruments | Commodity forward contracts and collars | |||||||
Derivatives, Fair Value | |||||||
British Thermal Units ("BTUs") | $ / BTU | 44 | ||||||
Total asset derivatives | $ 3 | ||||||
Total liability derivatives | 2 | ||||||
Derivatives designated as hedging instruments | Foreign exchange risk | |||||||
Derivatives, Fair Value | |||||||
Notional amount | 850 | 400 | |||||
Total asset derivatives | 68 | 9 | |||||
Derivatives designated as hedging instruments | Interest rate swaps - fair value hedges | |||||||
Derivatives, Fair Value | |||||||
Notional amount | € | € 725 | € 725 | € 725 | ||||
Total asset derivatives | 4 | 9 | |||||
Total liability derivatives | 39 | 2 | 1 | ||||
Derivatives designated as hedging instruments | Cash flow hedges of foreign exchange risk | |||||||
Derivatives, Fair Value | |||||||
Notional amount | $ 259 | 422 | 878 | ||||
Total asset derivatives | 2 | 9 | |||||
Total liability derivatives | 1 | 23 | 54 | ||||
Derivatives designated as hedging instruments | Net investment hedges | |||||||
Derivatives, Fair Value | |||||||
Notional amount | € | € 324 | € 311 | € 311 | ||||
Total asset derivatives | 36 | 3 | 2 | ||||
Total liability derivatives | 17 | 28 | |||||
Derivatives not designated as hedging instruments | Foreign exchange contracts | |||||||
Derivatives, Fair Value | |||||||
Notional amount | 448 | 202 | 291 | ||||
Total asset derivatives | 2 | 1 | 1 | ||||
Total liability derivatives | $ 17 | $ 2 | $ 4 |
Derivative Instruments - Effect
Derivative Instruments - Effects of Derivative Instruments (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Derivatives not designated as hedging instruments | Foreign exchange contracts | ||||
Derivatives and Hedges | ||||
Amount of Gain (Loss) Recognized in Other income (expense), net | $ (16) | $ 2 | $ (32) | $ 9 |
Derivatives designated as hedging instruments | ||||
Derivatives and Hedges | ||||
Gain (Loss) Recognized in OCI (Effective Portion) | 30 | 38 | 72 | 85 |
Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | 6 | 25 | 25 | 59 |
Derivatives designated as hedging instruments | Net Investment Hedges | Interest expense, net | ||||
Derivatives and Hedges | ||||
Gain (Loss) Recognized in OCI (Effective Portion) | 23 | 14 | 55 | 29 |
Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | 2 | 1 | 5 | 2 |
Derivatives designated as hedging instruments | Commodity forward contracts and collars | Cash Flow Hedges | Cost of goods sold | ||||
Derivatives and Hedges | ||||
Gain (Loss) Recognized in OCI (Effective Portion) | 7 | 4 | ||
Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | $ 4 | 6 | ||
Derivatives designated as hedging instruments | Foreign exchange risk | Cash Flow Hedges | Other Expense | ||||
Derivatives and Hedges | ||||
Gain (Loss) Recognized in OCI (Effective Portion) | 24 | 13 | 56 | |
Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | $ 24 | $ 14 | $ 57 |
Restructuring Accruals (Details
Restructuring Accruals (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Restructuring accrual | ||||
Beginning balance, restructuring reserve | $ 32 | $ 44 | $ 31 | $ 45 |
Charges | 10 | 12 | 21 | 20 |
Write-down of assets to net realizable value | (6) | (1) | (7) | (1) |
Net cash paid, principally severance and related benefits | (6) | (5) | (14) | (14) |
Other, including foreign exchange translation | (1) | (2) | ||
Ending balance, restructuring reserve | 29 | 50 | 29 | 50 |
Restructuring, Additional Information | ||||
Miscellaneous other costs | 0 | 0 | ||
Carrying value of impaired assets | 5 | 5 | ||
Employee Costs | ||||
Restructuring accrual | ||||
Beginning balance, restructuring reserve | 17 | 32 | 20 | 38 |
Charges | 3 | 6 | 2 | |
Net cash paid, principally severance and related benefits | (2) | (4) | (7) | (11) |
Other, including foreign exchange translation | (1) | (2) | (1) | |
Ending balance, restructuring reserve | 17 | 28 | 17 | 28 |
Asset Impairment | ||||
Restructuring accrual | ||||
Charges | 6 | 1 | 7 | 1 |
Write-down of assets to net realizable value | (6) | (1) | (7) | (1) |
Other Exit Costs | ||||
Restructuring accrual | ||||
Beginning balance, restructuring reserve | 15 | 12 | 11 | 7 |
Charges | 1 | 11 | 8 | 17 |
Net cash paid, principally severance and related benefits | (4) | (1) | (7) | (3) |
Other, including foreign exchange translation | 1 | |||
Ending balance, restructuring reserve | $ 12 | $ 22 | $ 12 | $ 22 |
Pension Benefit Plans (Details)
Pension Benefit Plans (Details) - Pension Benefit Plans - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Components of net periodic pension cost | ||||
Settlements | $ 5 | $ 5 | $ 5 | |
Decrease in benefit liability | $ 46 | 46 | ||
Funded Plan | U.S. | ||||
Components of net periodic pension cost | ||||
Service cost | 3 | 3 | 9 | 9 |
Interest cost | 9 | 10 | 26 | 30 |
Expected asset return | (15) | (21) | (45) | (63) |
Amortization of actuarial loss | 10 | 16 | 30 | 48 |
Net periodic pension cost | 7 | 8 | 20 | 24 |
Funded Plan | Non-US | ||||
Components of net periodic pension cost | ||||
Service cost | 2 | 3 | 7 | 9 |
Interest cost | 6 | 5 | 16 | 15 |
Expected asset return | (8) | (11) | (25) | (34) |
Amortization of actuarial loss | 2 | $ 3 | 7 | $ 10 |
Net periodic pension cost | $ 2 | $ 5 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended |
Jun. 30, 2022 | Sep. 30, 2022 | |
Income Taxes | ||
Statutory U.S. Federal tax rate (as a percent) | 21% | |
Mexican Tax Authority | ||
Income Taxes | ||
Settlement of tax audit | $ 38 |
Debt (Details)
Debt (Details) $ / shares in Units, € in Millions, $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||||||||||
Aug. 31, 2022 USD ($) | Nov. 30, 2021 USD ($) | Sep. 30, 2022 USD ($) $ / shares | Mar. 31, 2022 USD ($) | Sep. 30, 2022 USD ($) agreement $ / shares | Sep. 30, 2022 EUR (€) | Jul. 18, 2022 USD ($) | Mar. 25, 2022 USD ($) | Mar. 01, 2022 USD ($) | Feb. 28, 2022 USD ($) | Feb. 10, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2021 EUR (€) | Sep. 30, 2021 USD ($) | Sep. 30, 2021 EUR (€) | |
Debt Instrument | |||||||||||||||
Total long-term debt | $ 4,560 | $ 4,560 | $ 4,791 | $ 4,890 | |||||||||||
Less amounts due within one year | 280 | 280 | 38 | 37 | |||||||||||
Long-term debt | 4,280 | $ 4,280 | 4,753 | 4,853 | |||||||||||
Additional interest charges for note repurchase premiums and write-off of unamortized finance fees | 1 | ||||||||||||||
Maximum Borrowing Capacity | $ 2,800 | ||||||||||||||
Additional interest charges for related party fees | $ 2 | ||||||||||||||
Paddock | |||||||||||||||
Debt Instrument | |||||||||||||||
Face value | $ 8.5 | ||||||||||||||
Maximum | |||||||||||||||
Debt Instrument | |||||||||||||||
Leverage Ratio | 2.50 | ||||||||||||||
Secured Credit Agreement | |||||||||||||||
Debt Instrument | |||||||||||||||
Unused Credit | $ 1,240 | $ 1,240 | |||||||||||||
Number of financial maintenance covenants | agreement | 1 | ||||||||||||||
Additional default interest rate per annum applied to all obligations owed under the Agreement | 2% | ||||||||||||||
Secured Credit Agreement | Minimum | |||||||||||||||
Debt Instrument | |||||||||||||||
Interest rate margin, Term SOFR loans and Euro currency rate loans | 1% | 1% | 1% | ||||||||||||
Interest rate margin, Base Rate loans (as a percent) | 0% | ||||||||||||||
Secured Credit Agreement | Maximum | |||||||||||||||
Debt Instrument | |||||||||||||||
Interest rate margin, Term SOFR loans and Euro currency rate loans | 2.25% | 2.25% | 2.25% | ||||||||||||
Interest rate margin, Base Rate loans (as a percent) | 1.25% | ||||||||||||||
Revolving Loans | Minimum | |||||||||||||||
Debt Instrument | |||||||||||||||
Facility fee payable (as a percent) | 0.20% | ||||||||||||||
Revolving Loans | Maximum | |||||||||||||||
Debt Instrument | |||||||||||||||
Facility fee payable (as a percent) | 0.35% | ||||||||||||||
Revolving Loans | |||||||||||||||
Debt Instrument | |||||||||||||||
Weighted average interest rate (as a percent) | 4.81% | 4.81% | 4.81% | ||||||||||||
Term Loan A | |||||||||||||||
Debt Instrument | |||||||||||||||
Total long-term debt | $ 1,444 | $ 1,444 | |||||||||||||
Maximum Borrowing Capacity | $ 1,450 | 1,450 | |||||||||||||
Term Loan A | |||||||||||||||
Debt Instrument | |||||||||||||||
Total long-term debt | 923 | 1,068 | |||||||||||||
Debt redeemed | $ 128 | ||||||||||||||
Senior Notes | |||||||||||||||
Debt Instrument | |||||||||||||||
Additional interest charges for note repurchase premiums and write-off of unamortized finance fees | $ 13 | $ 16 | |||||||||||||
Senior Notes 4.00%, due 2023 | |||||||||||||||
Debt Instrument | |||||||||||||||
Total long-term debt | 308 | ||||||||||||||
Interest rate, stated percentage | 4% | 4% | 4% | ||||||||||||
Weighted average interest rate | 4% | ||||||||||||||
Debt redeemed | $ 310 | ||||||||||||||
Increase in long term debt, net of debt issuance costs | 395 | ||||||||||||||
Senior Notes 5.875%, due 2023 | |||||||||||||||
Debt Instrument | |||||||||||||||
Total long-term debt | $ 249 | $ 249 | 695 | 694 | |||||||||||
Interest rate, stated percentage | 5.875% | 5.875% | 5.875% | 5.875% | 5.875% | 5.875% | 5.875% | ||||||||
Debt repurchased amount | $ 150 | $ 250 | |||||||||||||
Debt redeemed | $ 300 | ||||||||||||||
Additional interest charges for note repurchase premiums and write-off of unamortized finance fees | $ 7 | ||||||||||||||
Fair values of fixed rate debt obligations | |||||||||||||||
Principal Amount | $ 250 | $ 250 | $ 550 | ||||||||||||
Indicated Market Price (in dollars per share) | $ / shares | $ 99.61 | $ 99.61 | |||||||||||||
Fair Value | $ 249 | $ 249 | |||||||||||||
Senior Notes 3.125%, due 2024 (725 million EUR) | |||||||||||||||
Debt Instrument | |||||||||||||||
Total long-term debt | $ 674 | $ 674 | € 725 | 826 | € 725 | 854 | € 725 | ||||||||
Interest rate, stated percentage | 3.125% | 3.125% | 3.125% | ||||||||||||
Fair values of fixed rate debt obligations | |||||||||||||||
Principal Amount | $ 711 | $ 711 | |||||||||||||
Indicated Market Price (in dollars per share) | $ / shares | $ 93.17 | $ 93.17 | |||||||||||||
Fair Value | $ 662 | $ 662 | |||||||||||||
Senior Notes 6.375%, due 2025 | |||||||||||||||
Debt Instrument | |||||||||||||||
Total long-term debt | $ 298 | $ 298 | 297 | 297 | |||||||||||
Interest rate, stated percentage | 6.375% | 6.375% | 6.375% | 6.375% | |||||||||||
Fair values of fixed rate debt obligations | |||||||||||||||
Principal Amount | $ 300 | $ 300 | |||||||||||||
Indicated Market Price (in dollars per share) | $ / shares | $ 94.40 | $ 94.40 | |||||||||||||
Fair Value | $ 283 | $ 283 | |||||||||||||
Senior Notes, 5.375% due 2025 | |||||||||||||||
Debt Instrument | |||||||||||||||
Total long-term debt | $ 299 | $ 299 | 298 | 298 | |||||||||||
Interest rate, stated percentage | 5.375% | 5.375% | 5.375% | 5.375% | |||||||||||
Fair values of fixed rate debt obligations | |||||||||||||||
Principal Amount | $ 300 | $ 300 | |||||||||||||
Indicated Market Price (in dollars per share) | $ / shares | $ 92.89 | $ 92.89 | |||||||||||||
Fair Value | $ 279 | $ 279 | |||||||||||||
Senior Notes 2.875%, due 2025 (500 million EUR) | |||||||||||||||
Debt Instrument | |||||||||||||||
Total long-term debt | $ 487 | $ 487 | € 500 | 561 | € 500 | 574 | € 500 | ||||||||
Interest rate, stated percentage | 2.875% | 2.875% | 2.875% | ||||||||||||
Fair values of fixed rate debt obligations | |||||||||||||||
Principal Amount | $ 490 | $ 490 | |||||||||||||
Indicated Market Price (in dollars per share) | $ / shares | $ 90.16 | $ 90.16 | |||||||||||||
Fair Value | $ 442 | $ 442 | |||||||||||||
Senior Notes 6.625%, due 2027 | |||||||||||||||
Debt Instrument | |||||||||||||||
Total long-term debt | $ 606 | $ 606 | 693 | 693 | |||||||||||
Interest rate, stated percentage | 6.625% | 6.625% | 6.625% | 6.625% | 6.625% | 6.625% | |||||||||
Debt repurchased amount | $ 88.2 | ||||||||||||||
Fair values of fixed rate debt obligations | |||||||||||||||
Principal Amount | $ 612 | $ 612 | $ 611.8 | ||||||||||||
Indicated Market Price (in dollars per share) | $ / shares | $ 90.45 | $ 90.45 | |||||||||||||
Fair Value | $ 554 | $ 554 | |||||||||||||
Senior Notes 4.75% due 2030 | |||||||||||||||
Debt Instrument | |||||||||||||||
Total long-term debt | $ 400 | $ 396 | $ 396 | 395 | |||||||||||
Interest rate, stated percentage | 4.75% | 4.75% | 4.75% | 4.75% | |||||||||||
Fair values of fixed rate debt obligations | |||||||||||||||
Principal Amount | $ 400 | $ 400 | |||||||||||||
Indicated Market Price (in dollars per share) | $ / shares | $ 79.94 | $ 79.94 | |||||||||||||
Fair Value | $ 320 | $ 320 | |||||||||||||
Finance leases | |||||||||||||||
Debt Instrument | |||||||||||||||
Total long-term debt | 103 | 103 | 98 | 99 | |||||||||||
Other debt | |||||||||||||||
Debt Instrument | |||||||||||||||
Total long-term debt | 4 | 4 | $ 5 | $ 5 | |||||||||||
Revolving Credit Facility | |||||||||||||||
Debt Instrument | |||||||||||||||
Maximum Borrowing Capacity | 300 | 300 | |||||||||||||
Delayed draw term loan facility | |||||||||||||||
Debt Instrument | |||||||||||||||
Maximum Borrowing Capacity | 600 | ||||||||||||||
Term loans in aggregate | |||||||||||||||
Debt Instrument | |||||||||||||||
Maximum Borrowing Capacity | $ 500 | ||||||||||||||
Multicurrency Revolving Credit Facility | |||||||||||||||
Debt Instrument | |||||||||||||||
Maximum Borrowing Capacity | $ 950 | $ 950 |
Contingencies - Asbestos (Detai
Contingencies - Asbestos (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||||||
Jul. 20, 2022 | Jul. 18, 2022 | Sep. 30, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | Jul. 08, 2022 | Dec. 31, 2021 | Jan. 06, 2020 | |
Loss contingencies | ||||||||
Sale of goods containing asbestos from 1948 to 1958 | $ 40 | |||||||
Cash | $ 47 | |||||||
Liability from deconsolidation | $ 625 | $ 625 | $ 471 | |||||
Charge related to Paddock support agreement | 154 | |||||||
Settlement consideration | $ 610 | |||||||
Funding to trust | $ 601.5 | |||||||
Funding to trust through borrowings | 600 | |||||||
Funding to trust through cash | 1.5 | |||||||
Total assets | $ 8,644 | 8,644 | 8,766 | 8,832 | ||||
Cash and cash equivalents | 523 | 523 | 628 | $ 725 | ||||
Operating cash outflow | $ (224) | $ 449 | ||||||
Paddock | ||||||||
Loss contingencies | ||||||||
Face value | $ 8.5 | |||||||
Deconsolidation investing outflow | $ 8.5 | |||||||
Total assets | 18 | |||||||
Cash and cash equivalents | 12 | |||||||
Liabilities | $ 30 | |||||||
Operating cash outflow | $ 618 |
Contingencies - Other Matters (
Contingencies - Other Matters (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended |
Jun. 30, 2021 | Sep. 30, 2021 | |
Contingencies | ||
Gain from favorable court ruling | $ 69 | $ 69 |
Income tax expense related to litigation settlement | $ 28 |
Share Owners' Equity - Rollforw
Share Owners' Equity - Rollforward (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Increase (Decrease) in Share Owners' Equity | ||||
Balance | $ 1,259 | $ 502 | $ 827 | $ 401 |
Issuance of common stock | 1 | |||
Reissuance of common stock | 2 | 3 | 8 | 7 |
Shares repurchased | (10) | (10) | (30) | (30) |
Stock compensation | 10 | 3 | 28 | 11 |
Net earnings | 235 | 91 | 612 | 123 |
Other comprehensive income (loss) | (44) | (19) | 36 | 60 |
Distributions to noncontrolling interests | (1) | (27) | ||
Other | (3) | (3) | ||
Balance | 1,451 | 570 | 1,451 | 570 |
Common Stock | ||||
Increase (Decrease) in Share Owners' Equity | ||||
Balance | 2 | 2 | 2 | 2 |
Balance | 2 | 2 | 2 | 2 |
Capital in Excess of Par Value | ||||
Increase (Decrease) in Share Owners' Equity | ||||
Balance | 3,085 | 3,113 | 3,090 | 3,129 |
Issuance of common stock | 1 | |||
Reissuance of common stock | (2) | (1) | (5) | (4) |
Shares repurchased | (10) | (10) | (30) | (30) |
Stock compensation | 10 | 3 | 28 | 11 |
Other | (2) | |||
Balance | 3,083 | 3,105 | 3,083 | 3,105 |
Treasury Stock | ||||
Increase (Decrease) in Share Owners' Equity | ||||
Balance | (695) | (709) | (701) | (714) |
Reissuance of common stock | 4 | 4 | 13 | 11 |
Other | (3) | (2) | ||
Balance | (691) | (705) | (691) | (705) |
Retained Earnings | ||||
Increase (Decrease) in Share Owners' Equity | ||||
Balance | 641 | 173 | 301 | 152 |
Net earnings | 231 | 85 | 571 | 106 |
Balance | 872 | 258 | 872 | 258 |
Accumulated Other Comprehensive Loss | ||||
Increase (Decrease) in Share Owners' Equity | ||||
Balance | (1,890) | (2,180) | (1,972) | (2,272) |
Other comprehensive income (loss) | (37) | (18) | 45 | 74 |
Balance | (1,927) | (2,198) | (1,927) | (2,198) |
Non-controlling Interests | ||||
Increase (Decrease) in Share Owners' Equity | ||||
Balance | 116 | 103 | 107 | 104 |
Net earnings | 4 | 6 | 41 | 17 |
Other comprehensive income (loss) | (7) | (1) | (9) | (14) |
Distributions to noncontrolling interests | (1) | (27) | ||
Other | 1 | |||
Balance | $ 112 | $ 108 | $ 112 | $ 108 |
Share Owners' Equity - Rollfo_2
Share Owners' Equity - Rollforward Shares (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Share Owners' Equity | ||||
Issuance of common stock (in shares) | 50,000 | |||
Reissuance of common stock (in shares) | 200,000 | 200,000 | 600,000 | 300,000 |
Shares repurchased (in shares) | 768,984 | 600,000 | 2,300,000 | 1,700,000 |
Stock compensation (in shares) | 0 | 0 | 500,000 | 600,000 |
Share Owners' Equity - Share Re
Share Owners' Equity - Share Repurchase (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Share Owners' Equity | ||||
Shares repurchased | $ 10 | $ 10 | $ 30 | $ 30 |
Shares repurchased (in shares) | 768,984 | 600,000 | 2,300,000 | 1,700,000 |
Stock repurchase plan authorized | $ 150 | $ 150 | ||
Remaining repurchase of common stock available | $ 80 | $ 80 |
Share Owners' Equity -Authoriza
Share Owners' Equity -Authorization of Common Stock (Details) - $ / shares | Sep. 30, 2022 | Dec. 31, 2021 | Sep. 30, 2021 |
Authorization of common stock | |||
Shares of common stock issued (including treasury shares) | 250,000,000 | 250,000,000 | 250,000,000 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 |
Shares of common stock issued (including treasury shares) | 186,180,000 | 187,752,000 | 188,426,000 |
Treasury shares | 31,042,000 | 31,397,000 | 31,599,000 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Increase (Decrease) Accumulated Other Comprehensive Loss, Net of Tax | ||||
Other comprehensive income (loss) attributable to the Company | $ (44) | $ (19) | $ 36 | $ 60 |
Net Effect of Exchange Rate Fluctuations | ||||
Increase (Decrease) Accumulated Other Comprehensive Loss, Net of Tax | ||||
Balance at beginning of the period | (1,275) | (1,187) | (1,290) | (1,229) |
Change before reclassifications | (92) | (109) | (77) | (67) |
Other comprehensive income (loss) attributable to the Company | (92) | (109) | (77) | (67) |
Balance at end of the period | (1,367) | (1,296) | (1,367) | (1,296) |
Change in Certain Derivative Instruments | ||||
Increase (Decrease) Accumulated Other Comprehensive Loss, Net of Tax | ||||
Balance at beginning of the period | 2 | (47) | (21) | (60) |
Change before reclassifications | 30 | 37 | 73 | 83 |
Amounts reclassified from accumulated other comprehensive loss | (6) | (25) | (25) | (59) |
Translation effect | (1) | 1 | ||
Tax effect | 1 | 1 | ||
Other comprehensive income (loss) attributable to the Company | 24 | 13 | 47 | 26 |
Balance at end of the period | 26 | (34) | 26 | (34) |
Employee Benefit Plans | ||||
Increase (Decrease) Accumulated Other Comprehensive Loss, Net of Tax | ||||
Balance at beginning of the period | (617) | (946) | (661) | (983) |
Change before reclassifications | 47 | (1) | 45 | |
Amounts reclassified from accumulated other comprehensive loss | 17 | 24 | 41 | 63 |
Translation effect | 14 | 7 | 35 | 7 |
Other comprehensive income (loss) attributable to the Company | 31 | 78 | 75 | 115 |
Balance at end of the period | (586) | (868) | (586) | (868) |
Accumulated Other Comprehensive Loss. | ||||
Increase (Decrease) Accumulated Other Comprehensive Loss, Net of Tax | ||||
Balance at beginning of the period | (1,890) | (2,180) | (1,972) | (2,272) |
Change before reclassifications | (62) | (25) | (5) | 61 |
Amounts reclassified from accumulated other comprehensive loss | 11 | (1) | 16 | 4 |
Translation effect | 14 | 7 | 34 | 8 |
Tax effect | 1 | 1 | ||
Other comprehensive income (loss) attributable to the Company | (37) | (18) | 45 | 74 |
Balance at end of the period | $ (1,927) | $ (2,198) | $ (1,927) | $ (2,198) |
Other Income (Expense), Net (De
Other Income (Expense), Net (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Other Income (Expense), Net | |||||
Gain on sale of divested business (see Note 17) | $ 55 | ||||
Gain on sale leasebacks (see Note 17) | $ 153 | 334 | |||
Restructuring, asset impairment and other charges | (10) | $ (12) | (21) | $ (21) | |
Brazil indirect tax credit (see Note 10) | $ 69 | 69 | |||
Pension settlement charges | (5) | (5) | (5) | (5) | |
Charge related to Paddock support agreement liability (see Note 10) | (154) | ||||
Intangible amortization expense | (8) | (9) | (24) | (26) | |
Foreign currency exchange loss | (3) | (1) | (4) | (3) | |
Royalty income | 7 | 6 | 18 | 17 | |
Other income (expense), net | $ 134 | $ (21) | $ 353 | $ (123) |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Numerator: | ||||
Net earnings attributable to the Company | $ 231 | $ 85 | $ 571 | $ 106 |
Denominator (in thousands): | ||||
Denominator for basic earnings per share - weighted average shares outstanding (in shares) | 155,115,000 | 156,825,000 | 155,546,000 | 157,430,000 |
Effect of dilutive securities: | ||||
Stock options and other (in shares) | 3,820,000 | 3,686,000 | 3,346,000 | 3,043,000 |
Denominator for diluted earnings per share - adjusted weighted average shares outstanding (in shares) | 158,935,000 | 160,511,000 | 158,892,000 | 160,473,000 |
Basic earnings per share: | ||||
Earnings from continuing operations (in dollars per share) | $ 1.49 | $ 0.49 | $ 3.67 | $ 0.62 |
Gain from discontinued operations (in dollars per share) | 0.05 | 0.05 | ||
Net earnings (loss) attributable to the Company (in dollars per share) | 1.49 | 0.54 | 3.67 | 0.67 |
Diluted earnings per share: | ||||
Earnings from continuing operations (in dollars per share) | 1.45 | 0.48 | 3.59 | 0.61 |
Gain from discontinued operations (in dollars per share) | 0.05 | 0.05 | ||
Net earnings (loss) attributable to the Company (in dollars per share) | $ 1.45 | $ 0.53 | $ 3.59 | $ 0.66 |
Weighted average shares of common stock attributable to options not included in diluted earnings per share (in shares) | 724,186 | 958,014 | 1,035,227 | 1,206,870 |
Supplemental Cash Flow Inform_3
Supplemental Cash Flow Information (Details) - USD ($) $ in Millions | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Supplemental Cash Flow Information | |||
Amount of receivables sold | $ 447 | $ 416 | $ 481 |
Receivables sold under supply chain factoring program | 174 | 189 | $ 180 |
Interest paid in cash | 172 | 144 | |
Increase or decrease to cash from operating activities from factoring programs | (34) | (20) | |
Expense due to factoring program | 6 | 4 | |
Income taxes paid in cash | |||
Income taxes paid in cash | 137 | 64 | |
Cash interest included in note repurchase premiums | 17 | ||
U.S. operations | |||
Income taxes paid in cash | |||
Income taxes paid in cash | 9 | 6 | |
Non-U.S. | |||
Income taxes paid in cash | |||
Income taxes paid in cash | $ 128 | $ 58 |
Divestitures and Sale Leaseba_2
Divestitures and Sale Leasebacks of Land and Building (Details) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Aug. 31, 2022 | May 31, 2022 | Jan. 31, 2021 | Sep. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2022 | |
Divestitures | ||||||
Gain on sale leasebacks | $ 153 | $ 334 | ||||
Gain on sale of divested business | $ 55 | |||||
Argentina | Other operating income (expense) | Disposal Group, Not Discontinued Operations | ||||||
Divestitures | ||||||
Gross proceeds | $ 10 | |||||
Cristar TableTop S.A.S. | Other operating income (expense) | Disposal Group, Not Discontinued Operations | ||||||
Divestitures | ||||||
Gross proceeds | $ 96 | |||||
Gain on sale of divested business | 55 | |||||
Gain on sale of businesses, after tax | $ 16 | |||||
Vernon, California (Los Angeles) Plant | Disposal Group, Not Discontinued Operations | ||||||
Lease | ||||||
Lease term | 10 years | |||||
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Other Assets, Noncurrent | Other Assets, Noncurrent | ||||
Operating lease right-of-use assets (included in Other assets) | $ 62 | $ 62 | ||||
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Other Liabilities, Current | Other Liabilities, Current | ||||
Current operating lease liabilities (included in Other current liabilities) | $ 3 | $ 3 | ||||
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Other Liabilities, Noncurrent | Other Liabilities, Noncurrent | ||||
Noncurrent operating lease liabilities (included in Other long-term liabilities) | $ 59 | $ 59 | ||||
Vernon, California (Los Angeles) Plant | Disposal Group, Not Discontinued Operations | Minimum | ||||||
Lease | ||||||
Rent payment | $ 7.2 | |||||
Vernon, California (Los Angeles) Plant | Disposal Group, Not Discontinued Operations | Maximum | ||||||
Lease | ||||||
Rent payment | 10.3 | |||||
Vernon, California (Los Angeles) Plant | Other operating income (expense) | Disposal Group, Not Discontinued Operations | ||||||
Divestitures | ||||||
Net proceeds | 181 | |||||
Gain on sale leasebacks | 153 | |||||
Gain on sale of businesses, after tax | $ 153 | |||||
Brampton, Ontario, Canada Plant | Disposal Group, Not Discontinued Operations | ||||||
Lease | ||||||
Lease term | 10 years | |||||
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Other Assets, Noncurrent | Other Assets, Noncurrent | ||||
Operating lease right-of-use assets (included in Other assets) | $ 54 | $ 54 | ||||
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Other Liabilities, Current | Other Liabilities, Current | ||||
Current operating lease liabilities (included in Other current liabilities) | $ 4 | $ 4 | ||||
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Other Liabilities, Noncurrent | Other Liabilities, Noncurrent | ||||
Noncurrent operating lease liabilities (included in Other long-term liabilities) | $ 51 | $ 51 | ||||
Brampton, Ontario, Canada Plant | Disposal Group, Not Discontinued Operations | Minimum | ||||||
Lease | ||||||
Rent payment | $ 7.3 | |||||
Brampton, Ontario, Canada Plant | Disposal Group, Not Discontinued Operations | Maximum | ||||||
Lease | ||||||
Rent payment | 9.1 | |||||
Brampton, Ontario, Canada Plant | Other operating income (expense) | Disposal Group, Not Discontinued Operations | ||||||
Divestitures | ||||||
Net proceeds | 190 | |||||
Gain on sale leasebacks | 182 | |||||
Gain on sale of businesses, after tax | $ 158 |